More than VND 311,000 billion in corporate bonds to be issued in 2023

ANTD.VN - In 2023, the total value of corporate bond issuance was recorded at VND 311,240 billion, of which banks were the leading group, followed by real estate.

According to data from the Vietnam Bond Market Association (VBMA), in December, there were 55 private corporate bond issuances with a total value of VND42,806 billion. The issuances had an average interest rate of 7.06%/year, with an average term of 5.97 years.

For the whole year of 2023, the total value of corporate bond issuance was recorded at VND 311,240 billion, including 29 public issuances worth VND 37,071 billion (accounting for 11.9% of the total issuance value) and 286 private issuances worth VND 275,028 billion (accounting for 88.1% of the total).

Banking is the industry group that issues the most with VND 176,006 billion (equivalent to 56.5% of the total issuance value), followed by the real estate group with VND 73,202 billion (accounting for 23.5%).

In December, businesses bought back VND32,677 billion worth of bonds, down 50.4% year-on-year.

In 2024, it is estimated that there will be about VND 277,065 billion of bonds maturing. Of which, 41% of the value of bonds about to mature belongs to the real estate group with nearly VND 113,486 billion, followed by the banking group with nearly VND 54,497 billion (accounting for 20%).

The number of bonds with late interest payments in the month has decreased compared to the beginning of the year, with only 6 new bond codes announcing late interest/principal payments with a total value of VND 545.7 billion in December.

During the month, 8 bond codes were also extended with maturity periods extended mainly from 1 to 2 years.

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The corporate bond market is warming up.

Notably, despite the economic difficulties, 2023 saw real estate bonds gradually warming up again. The amount of capital mobilized through the bond channel of real estate businesses in 2023 increased by 40.8%. This figure is still low compared to the two peak years of 2020-2021 when the real estate market was growing rapidly, but is still about 20% higher than the period before the pandemic (2019).

Over the past year, the market has seen many real estate businesses issue bonds worth thousands of billions of VND per lot.

It can be mentioned that Capitaland Tower Company Limited has 4 issuances and mobilized a total of more than 12,200 billion VND.

Nam An Investment and Trading Joint Stock Company issued corporate bonds to raise VND4,700 billion. TMT Real Estate Investment and Development Joint Stock Company issued two corporate bond tranches to raise VND4,030 billion.

Hung Yen Urban Development and Investment Company Limited issued two corporate bonds, raising about 7,200 billion VND. Southern Star Urban Development and Investment Joint Stock Company issued corporate bonds, raising 4,695 billion VND...

If only considering the value of each lot, Luxury Living Furniture Investment and Trading Company Limited is the enterprise that mobilized the most capital with 4,800 billion VND.

Regarding interest rates, last year the real estate group recorded a common interest rate, paying interest to bondholders of 12%/year.

Some businesses set even higher interest rates. Among them, Vinam Land and Xuan Thanh Social Housing recorded bond lots with interest rates up to 14%/year.

According to records, corporate bond issuance was almost quiet in the first half of the year. There were months when the market did not record any successful issuance.

Since Decree 08 was issued in early March, with many regulations "unleashing" businesses issuing bonds, such as allowing businesses to negotiate with bond buyers to pay principal and interest due with other assets, the market has gradually warmed up.

However, according to general assessment, the issuance of bonds by real estate enterprises in recent times is not actually to serve business when new supply and product absorption rate in 2023 have decreased sharply compared to the previous year.

Accordingly, the purpose of issuing bonds of the real estate group is mainly to restructure and extend debt repayment period.

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