The Song Da and Hoa Phat Corporations’ successful issuing of thousands of billions of VND worth of bonds in July is continuing to heat up the corporate bond market.

The Song Da Corporation issued bonds worth a total of 1.5 trillion VND, or 79 million USD with a five year maturity and an interest rate of 15 percent for the first year while the Hoa Phat Corporation raised 800 billion VND, equivalent to 42 million USD, from bonds that mature in three years.

Several larger companies have raised capital this way, such as Vietnam Electricity, the Vietnam Construction and Export Import Joint Stock Company, which issued two trillion VND worth of bonds each and the Vincom Joint Stock Company which issued one trillion VND in bonds.

These moves showed that the corporate bond market is thriving and that investor’s confidence has improved. In this way, businesses can access middle and long-term capital at a stable interest rate and there is less pressure on the banks to supply capital.

According to financial experts, the recovery in the economy, a stable inflation rate and a prime interest rate of 8 percent have had a positive impact on businesses and investors.

It is forecast that the corporate bond market will be more vibrant when limited liability companies are allowed to issue bonds under a new draft decree./.