The Joint Stock Commercial Bank for Foreign Trade of Vietnam (VCB) and the Asia Commercial Joint Stock Bank (ACB) issued a total of $452 million worth of bonds in 2016.
Customer and VCB employee during a transaction at VCB office in Ha Noi. Together with ACB, the bank had issued a total of more than $451 million bond worth in 2016 to public investors.
The 2016 year-end reports revealed that while VCB issued VND8 trillion (US$360 million) worth of bonds, ACB issued VND2.05 trillion ($92.6 million) worth of bonds, lower than its target of VND2.5 trillion.
VCB issued public bonds worth VND2 trillion in 2016 with a 10-year maturity date and a total yield consisting of the benchmark yield plus a 1 per cent annual rate. The bank issued bonds from October 26 to November 25, 2016. The State Bank of Viet Nam had given VCB the nod to issue bonds using domestic currency at a face value of $360 million.
ACB issued VND1.05 trillion worth of bonds from November to December 2016. Its initial plan was to issue bonds worth VND1.5 trillion to add to its second-rate capital and ultimately increase its mid- and long-term capital rates.
While ACB did not achieve its goal, it has successfully mobilised a long-term source of capital of up to 10 years. In the first five years, ACB will give an interest rate equal to the benchmark rate plus 2 per cent per annum, which will increase to 2.5 per cent in the next five years.
VCB’s report at the year-end business conference for 2016 and its 2017 implementation plans show that the bank has issued VND8 trillion worth of bonds to the public and other financial institutions, including VND6 trillion worth of additional premium bonds.
On June 30, 2016, ACB had reported having mobilised VND1 trillion worth of bonds with a five-year maturity period. It initially registered a public offering but its bonds were offered to only 34 investors, seven of whom bought 85.75 per cent of the total issued bonds. The yield for the first period will be 8.5 per cent per annum, with a floating rate equal to the benchmark rate plus 2 per cent for the following period.
In 2016, issuing shares to attract capital did not prove to be a great success for commercial banks in Viet Nam, but the capital flow was strong owing to bonds issuance.
Vietnam: Manufacturing to remain the key driver of growth
We expect robust exports, led by strong global demand for electronics, to continue to underpin solid economic growth over the remainder of this year with GDP forecast to rise close to 8%.
GDP growth was unchanged at 4.5% y/y in Q1. Manufacturing activity surged, while the recovery in service sector activity and construction continued albeit at a more subdued pace as some localised social distancing measures were reinstated.
Vietnam Lao Cai popularises Sa Pa-Fansipan tourism trademark
Vietnam Cooperatives struggle to access COVID-19 support
The survey was conducted on 174 Vietnam cooperatives in 24 provinces and cities and 34 cooperative alliances of provinces and cities to assess the impact of the COVID-19 pandemic on cooperatives in Vietnam
Hanoi (VNS/VNA) – Most cooperatives have been harmed by the COVID-19 pandemic while only a small proportion of them have benefited from support policies, heard a forum held by the Vietnam Cooperative Alliance (VCA) and the United Nations Development Programme (UNDP) on March 24.
Subscribe via Email
3 Reasons to Be Optimistic About the Baht Right Now
Probably one of the most important factors for the rise of the Baht is the continued weakness of the US...
Will Thailand’s plan for quarantine-free tourism set a global trend?
According to the Tourism Authority of Thailand, the quarantine-exemption measures implemented in Phuket will be extended to five other key...
Thailand Approves Latest Economic Relief Package for Businesses
Some 250 billion baht (US$8 billion) was allocated for soft loans while the remaining 100 billion baht (US$3.2 billion) will...
Southeast Asia remains a hot spot for plastic pollution
The use of plastics is deeply embedded in our daily lives, in everything from grocery bags and cutlery to water...
Thailand BOI approves Biotech Projects Worth 2.4 Bln Baht ($78 million)
The biotechnology sector is part of the so-called BCG model (Bio, Circular and Green economy) which the Thai government has...
Diamonds are forever but “James Bond Island” in Phang Nga Bay may not
Thailand’s Department of Mineral Resources will assess the stability of the limestone karst towers, which make up the chain of...