Bank for Investment and Development of Vietnam (BIDV) said it had sold out VND2.03 trillion worth of corporate bonds with terms of 2-3 years.
This is the biggest issuance of corporate bonds in Vietnam dong this year and is the first bond sale by BIDV in 2012. The bonds are unsecured and not secondary debts of the issuer.
BIDV will use the money raised from the bond sale to supplement its middle- and long-term capital sources, restructure the capital sources to meet the demand for loans of middle- and long-term projects and ensure capital safety under the criteria set by the central bank.
The issuance attracted the attention of the market with the volume of bonds ordered by investors higher than the volume offered for sale.
This is the first successful bond sale of a credit institution since 2011, given the sluggish corporate bond market in the year to date.
Selling corporate bonds is considered the most viable option as a long-term capital raising channel under the current circumstances that banks cannot mobilize long-term capital from citizens and share issuance continues to face many difficulties.
The corporate bond trading market (secondary market) has been dull all year, with a trade volume of less than VND200 billion, according to Bao Viet Securities Company.
The Saigon Times Daily