BondXpress November: More Diverse Issuance Structure and the Emergence of Green Bonds

The corporate bond market in November recorded a more diverse issuance structure by sector. Meanwhile, the supply of privately placed corporate bonds could be significantly impacted in the near future if the Draft Amendment to the Securities Law is approved. Additionally, the market has witnessed the issuance of some green bonds by non-financial issuers this year.

The corporate bond market in November recorded a more diverse issuance structure by sector. Meanwhile, the supply of privately placed corporate bonds could be significantly impacted in the near future if the Draft Amendment to the Securities Law is approved. Additionally, the market has witnessed the issuance of some green bonds by non-financial issuers this year. 

Below are key highlights from FiinRatings' November BondXpress report: 

• Corporate bond (C-bond) issuance activity declined compared to the previous month, but the structure by sector became more diverse: The total issuance value in October 2024 significantly decreased compared to the previous month, as the bond issuance activities of credit institutions (CI) slowed down. The total issuance reached VND 33.0 trillion through 38 issuances, a drop of 41.4% month-over-month but a 1.6% increase year-over-year. However, the sector breakdown became more diverse, with the proportion of CI bonds dropping to 58%, compared to over 80% in previous months. 

• The value of problematic bonds in October 2024 continued to rise at a slower pace: The proportion of problematic corporate bonds (including defaulted and restructured bonds) reached 19.0% (+10 basis points compared to the previous month). 

• New requirements for either collateral or payment guarantees by credit institutions for professional individual investors to participate in the private placement C-bond market by the Draft Amended Securities Law may affect the market supply if passed. In the first 10 months, only about 12% of the total issuance value of C-bonds had collateral, and less than 3% were guaranteed by credit institutions. Moreover, payment guarantees by international organizations are not mentioned in the Draft Amendment. 

• Since the beginning of the year, four green bonds have been issued under the Green Bond Principles by the International Capital Market Association (ICMA), with a total value of VND 6.9 trillion, accounting for about 2% of the total issuance during the period. These bonds were independently verified, including assessments by FiinRatings on the Green Bond Framework. 

For the full BondXpress November report by FiinRatings, please refer to THIS LINK.   

About FiinRatings   

FiinRatings, a member of FiinGroup and a technical cooperation partner of S&P Global Ratings, is a licensed credit rating agency in Vietnam. FiinRatings provides credit ratings and related services to issuers, credit institutions, and investors in the Vietnamese credit market. FiinRatings is also the first authorized green bond verifier in Vietnam, adhering to the international green bond standards of the Climate Bonds Initiative... For more information, please visit https://fiinratings.vn/     

FiinGroup is Vietnam's leading provider of financial data analytics platforms, business information services, and industry research. FiinGroup provides services to domestic and foreign investors in the capital market and businesses to support their business development in Vietnam. For more information, please visit https://www.fiingroup.vn 

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