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2025-07-30 16:29:44
Is Vietnam's government bond issuance cooling off? A trillion-dollar funding gap remains to be filled. ⑴ On the evening of July 30th, Beijing time, the Vietnamese Ministry of Finance successfully raised 9 trillion VND (approximately US$343 million) in a government bond auction on Wednesday. ⑵ The amount raised was higher than last week's $326 million, but the bond subscription rate declined, with only 75% of the offering sold, down from 85% last week. ⑶ According to data from the Hanoi Stock Exchange, cumulative government bond sales in Vietnam have reached 215 trillion VND (approximately US$8.2 billion) so far this year. ⑷ The Vietnamese government primarily uses bond sales to fund public investment, a key driver of economic growth, and plans to raise 500 trillion VND this year. ⑸ In this auction, the Ministry of Finance successfully sold all 8 trillion VND of 10-year bonds at a coupon rate of 3.29%, the highest for this maturity this year. ⑹ 5-year bonds were sold for 300 billion VND (out of a total of 500 billion VND), with a coupon rate of 2.75%. 7. 15-year bonds sold for VND650 billion (out of a total of VND3 trillion issued), with a coupon rate of 3.40%. 8. 30-year bonds sold for only VND84 billion (out of a total of VND500 billion issued), with a coupon rate of 3.45%. 9. As of July 25, Vietnamese companies had raised VND286.9 trillion through bond issuance this year. 10. Data shows that VND118.7 trillion in corporate bonds will mature in the remainder of 2025, of which 52.2% are from the real estate sector and 28% from the banking sector. 11. The decline in government bond subscription rates may reflect cautious market sentiment, posing a challenge to Vietnam's ability to meet its annual fundraising targets.
