01.12.2022, 07:39

Ministry of Finance orders bond issuers to pay off debt

HCMC – The Ministry of Finance (MOF) has written to debt-issuing organizations, ordering them to cough up the principal and interest of their bonds and to closely follow regulations on bond issues.

To ensure investors’ legitimate rights, the ministry said that bond issuers would have to work with buyers and seek solutions to pay up in case they face insolvency.

It also told them to stick to Government Decree 153/2020/ND-CP and Decree 65/2022/ND-CP, which set out rules on bond trading via private placement and information disclosure, along with other guidance.

According to the ministry, the stock and bond markets have been highly volatile over the past few months, with misinformation spreading like wildfire. Though the Ministry of Public Security has tackled the misleading news and sanctioned violators, the markets are still adversely impacted.

Thus, the MOF advised businesses to proactively disclose information on their operations and use auditing, credibility rating, and asset evaluating services to win investor confidence.

Some VND53 trillion worth of corporate bonds will fall due at the end of the year, with 39% of them issued by real estate companies and 19% by manufacturing ones, the Vietnam News Agency reported, citing Minister of Finance Ho Duc Phoc as saying at a meeting with seven securities companies and 32 debt-issuing corporations.

The figures may swell to VND284 trillion next year and to VND363 trillion in 2024, Phoc said, adding that corporations breaching the rules, coupled with scandalous rumors, has dampened the market sentiment, leading to low liquidity in the markets.

Still, the bond market remained one of the crucial fund-raising channels for businesses, and it held much potential, the minister continued.