Corporate bonds: New issuance of 180 trillion but early buyback of up to 190 trillion

ANTD.VN - In the first 10 months of the year, businesses issued 180.4 trillion VND in bonds but bought back 190.7 trillion VND before maturity. The remaining 61.6 trillion VND matured in the last 3 months of the year.

The Ministry of Finance said that in the first 10 months of the year, 70 enterprises issued corporate bonds with a volume of 180.4 trillion VND, down 45.1% over the same period in 2022.

Notably, according to the Ministry of Finance, the volume of bonds issued mainly focused on the period after Decree 08/2023/ND-CP took effect (March 5, 2023), with VND 179.5 trillion.

In October alone, the issuance volume was 41 trillion VND, an increase of 17 trillion VND compared to September (23.4 trillion VND).

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Corporate bond issuance volume is lower than buyback volume

While bond issuance has decreased sharply, businesses have stepped up the purchase of bonds before maturity. Since the beginning of the year, businesses have purchased up to 190.7 trillion VND worth of bonds before maturity, higher than the total issued amount and up to 30.2% compared to the same period last year.

In October 2023 alone, businesses bought back about VND 14.2 trillion ahead of schedule.

The Ministry of Finance said that the main investors buying individual corporate bonds (TPDN) in the primary market in the first 10 months of 2023 were institutional investors, accounting for 95% of the total issuance volume (mainly banks accounting for 61%), and individual investors bought 5%.

In the secondary market, as of June 30, 2023, individual investors hold about 28.5% of total outstanding individual corporate bonds (equivalent to about VND 285.6 trillion).

Regarding maturity, the Ministry of Finance said that the maturity volume in the last 3 months of 2023 is 61.6 trillion VND.

To continue stabilizing and developing the corporate bond market, the Ministry of Finance said that it has reported to the Government leaders on the overall management solutions. The main groups of solutions include: synchronously implementing solutions to manage macro policies, control inflation, promote disbursement of public investment capital; remove difficulties, stabilize the real estate market;

Monitor the payment of corporate bonds due and strengthen information and propaganda work; organize the market and improve the effectiveness of management and supervision; conduct a comprehensive review to perfect legal provisions in the Securities Law, Enterprise Law and related Laws;

Research policies to encourage credit ratings, promote the roadmap for upgrading the stock market, develop the system of institutional investors; increase resources and personnel for inspection agencies of the State Securities Commission and the State Bank.

Regarding handling violations, recently, the Ministry of Finance has received complaints from investors related to the case of SCB Bank - Van Thinh Phat Group and petitions from people who came to deposit savings and were invited by some banks to buy corporate bonds.

These petitions are being handled by the Ministry's leaders and the State Securities Commission.

“Regarding this issue, from 2019 to present, the Ministry of Finance has issued 6 documents requesting the State Bank to strengthen management and supervision of commercial banks in the distribution, commitment to buy back, provision of services related to corporate bonds and regularly coordinate to provide information on the situation of the corporate bond market” – said the Ministry of Finance.

At the same time, the Ministry of Finance also coordinated to transfer investors' petitions to the Ministry of Public Security .

Currently, the Ministry of Public Security has concluded the investigation into the case of Tan Hoang Minh Group and is investigating the cases of SCB Bank and Van Thinh Phat Group.

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