Investment funds and banks strongly buy VietinBank’s bonds

05-Oct-2021 Intellasia | NDH | 5:02 AM Print This Post

Commercial Joint Stock Bank for Industry and Trade of Vietnam (VietinBank) has announced the completion of the issuance of 50 billion dong of 15-year bonds with a fixed interest rate of 6.7 percent per annum. The maturity date is September 17th 2036. An investment fund fully purchased this amount of bonds.

VietinBank will also offer another 50 billion dong of bonds with term of eight years and floating interest rate, expected in September and October.

Previously, the bank also completed the 12th, 13th and 14th private placements with total mobilisation of two trillion dong each time to credit institutions. The bonds’ interest rates are floating, par value is one billion dong and term is eight years. These bonds are non-convertible, not secured by assets, and satisfy all conditions to be included in VietinBank’s Tier-2 capital. This batch of bonds was purchased in full by another credit institution.

From the beginning of the year, VietinBank has mobilised nearly 6.550 trillion dong from bond private placements. The bank plans to issue 10 trillion dong of bonds to the public in 2021, equivalent to 100 million bonds with a par value of 100,000 dong per bond, divided into two phases, the first phase from Q2 to Q3, and the second phase from Q3 to Q4.

In the first phase, VietinBank plans to issue 80 million bonds with a total value of eight trillion dong, including four trillion dong of eight-year bonds and four trillion dong of 10-year bonds. In the second phase, VietinBank plans to issue one trillion dong of eight-year bonds and one trillion dong of 10-year bonds.

The bonds’ interests are paid once a year with variable interest rates. Specifically, the interest rate of the eight-year bonds (2129) is equal to the reference interest rate plus 0.9 percent per annum. The rate of the 10-year bonds (2131) is equal to the reference interest rate plus one percent per annum. The bank said that the issuance of bonds aims to increase the scale of operating capital, lend to the economy, increase Tier-2 capital, and ensure capital adequacy ratios.

 

Category: Finance, Vietnam

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