The Ministry of Finance has conducted procedures to adjust and supplement the Government’s Decree 65 regarding the private issuance of corporate bonds, Deputy Minister Nguyễn Đức Chi said at a government regular press conference in Hà Nội on Thursday.

Chi said that the ministry had so far completed the impact assessment process and consulted with ministries, sectors, organisations and experts, including international organisations.

It had also requested the Ministry of Justice’s verification, and finalising a draft decree on the adjustments and supplements to a number of contents of Decree 65, he said, adding that the draft decree is scheduled to be submitted to the Government next week.

Chi underlined that the adjustments and supplements of the decree aimed to ensure that the regulations suit reality, reinforcing market confidence and creating favourable conditions for issuers, and protecting the legitimate rights and interests of investors in the corporate bond market.

Previously, at the regular Government meeting in January 2023, Prime Minister Phạm Minh Chính emphasised the request to remove difficulties for the real estate market, such as corporate bonds.

The Prime Minister requested to urgently finalise and issue a decree amending and supplementing Decree 65 regarding the private issuance of corporate bonds.

According to the assessment of the Ministry of Finance, the current difficulties of the corporate bond market include some particular problems: The volume of new bond issuance decreased; bond repurchase volume increased; and with a large volume of bonds coming due in the near future, enterprises facing difficulties in cash flow to balance resources to pay due debt obligations and mobilise capital for production and business activities.

The main cause of the above situation is the mistakes of some businesses when discovered by the investigation agency and some fabricated news which negatively affects the market and investors’ confidence.

The liquidity of the whole economy was unstable, so enterprises had difficulties in production and business and cash flow. Bank interest rates increased sharply in a short time, leading to the trend of capital flow shifting from the stock market to the banking channel, investors reselling corporate bonds to switch to bank savings with high interest rates, the Ministry of Finance said. VNS