Vietcombank will issue bonds totalling 5 trillion VND (264.55 million USD) to generate capital for business development, improve infrastructure and ensure a capital adequacy ratio of at least 10 percent of total capital, under a plan approved this week by the State Bank of Vietnam.

The bond issue will be divided into both Vietnamese dong and US dollar tranches, with the lion's share, 4.6 trillion VND (243.38 million USD), to be issued in dollars and the remaining 400 billion VND (21.16 million USD) in the local currency.

Enterprises (excluding credit institutions) will not be eligible to buy the dollar bonds.

The bonds would have a maturity date of at least two years and bear an interest rate dependent upon market rates at the time of the issue, said Le Thi Hoa, a member of Vietcombank's executive board.

The bank had yet to determine a consultant for the issue and were still in the process of drawing up a detailed plan, Hoa added.

Vietcombank also has plans to increase its charter capital in the second and fourth quarters of this year from 12.1 trillion VND (640.21 million USD) to 17.58 trillion VND (930.16 million USD).

The State Bank of Vietnam has replaced the State Capital Investment Corporation (SCIC) as the representative of State-owned capital in Vietcombank. The Hanoi-based commercial bank remains over 90.7 percent State-owned./.