Strengthen corporate bond management

Retail investors turn into professional investors

According to regulations, not all individual investors are allowed to buy corporate bonds private placement, but must be professional investors, ie financial institutions or individuals with securities practice certificates; holding a list of securities listed or registered for trading with a minimum value of VND 2 billion; individuals whose taxable income in the latest year is at least VND 1 billion. This is a way to protect retail investors from risks.

However, sometimes retail investors can turn into professional investors easily. Some bond sales units are ready to stand up for investors.

Not available yet stock accountalso do not need to meet the conditions as prescribed, according to the broker, it only takes a few million dong to get a certificate of professional investor from a securities company.

(Artwork – Photo: VGP)

Sustainability for the bond market

It is not wrong for businesses to issue bonds to mobilize idle capital from the people, instead of borrowing bank credit, and is like many other countries. However, the fact that the corporate bond market in Vietnam has grown so hot as it has been in the past year and new problems arise will give state management agencies and investors more experience.

To sustainably develop Vietnam’s corporate bond market and protect retail investors, international organizations have made recommendations.

“In many other markets, the number of private investors is limited to only 5-10 investors. In Vietnam, this number is much larger. Therefore, we want to encourage issuance. to the public, simplify the procedure and limit the private placement,” recommended Mr. Donail Lambert – Head of Private Sector Development, Asian Development Bank (ADB).

Mr. Sing Chan Ng – Head of Business Relationship Management for Asia – Pacific, Fitch Ratings said: “It is necessary to encourage bond issuers to give credit ratings to set an example of how they are doing. Bond pricing and benefits compared to unrated bonds, thereby stirring up the market’s interest, and investors themselves will gradually form the habit of requiring issuers to have credit rating for their bonds to participate in investment”.

Faced with the above recommendations, what solutions will Vietnamese regulators have to increase the issuance standards and monitor the corporate bond market? How to manage but not restrict this activity?

Around the above contents, the program Today’s problem with the participation of Mr. Nguyen Hoang Duong – Deputy Director of the Finance Department of banks and financial institutions, the Ministry of Finance had specific discussions. We invite you to follow along!

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