Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank-STB) has recently released the documents for its coming annual general meeting (AGM) whereby the bank will submit a plan to issue about $200 million worth of unsecured and unconvertible international bonds with 5-year tenor.
The bond issuance is scheduled in the second or the third quarter this year. The coupon rate will be fixed basing on the market interest rates at the time of issuing. The bonds are expected to list on Singapore Stock Exchange.
The proceeds from the bond will be used for the bank’s business activities.
Sacombank’s capital mobilisation plan via international market is taking place in the context of the bank’s difficult capital mobilisation in 2011. By the end of 2011, the lender’s total deposits reached 123.315 trillion dong, equalling to 88 percent of the year’s plan and down 2 percent from early last year.
According to the bank’s director board, the evolutions of the market and the State Bank of Vietnam (SBV)’s tightening monetary policy in 2011 have affected the capital mobilisation activities, especially for gold and US dollar, causing slower growth in the bank’s total deposits in comparison with previous years.
In 2012, the listed bank’s director board will submit the AGM to pass total deposit plan of 143.5 trillion dong, rising 16 percent from 2011.
In February, S&P and Moody’s have also gave credit rating for Sacombank for the first time. According to S&P, Sacombank’s long term credit rating is at B+ and short term at B with long term outlook at stable.
Meanwhile, Moody’s gave Sacombank’s credit rating at B2 for short and long term credit rating in foreign currency, B1 for short and long term credit rating in local currency and Sacombank’s debt rating was also at B1. Its Bank Finance Strength Rating (BFSR) was at E+. According to Moody’s, the outlook for all ratings is stable, except for the negative outlook for deposits and bonds issued in foreign currencies.
Together with Sacombank, this year some local banks also have issued and built plan to issue bonds in the international market.
Particularly, Vietnam Commercial Joint Stock Bank of Industry and Trade (VietinBank-CTG) on May 10 successfully raised $250 million worth of 5-year tenor unsecured international bonds at the coupon rate of 8 percent per annum. This year, VietinBank plans to issue $2 billion worth of international bonds.
Vietnam Commercial Joint Stock Bank for Foreign Trade (VietcomBank-VCB)’s AGM 2012 also passed a plan to sell maximum $1 billion worth of international bonds with 10-year tenor at the maximum. The issuance is scheduled in 2012 or at an appropriate time.