The Vietnamese port city of Hải Phòng has set its sights high, outlining an ambitious plan to to mobilize billions dollars by tapping into socialized funding sources to propel urban development and bolster its infrastructure.

An update from the Vietnam Bond Market Association (VBMA), the Hanoi Stock Exchange (HNX), and the State Securities Commission (SSC) puts the total value of bonds redeemed before maturity at VND28.833 trillion ($1.2 billion) in September, up 199 per cent over the same period last year. The total value of bonds bought back by businesses in the first nine months of 2022 was VND142.209 trillion ($5.9 billion), up 67 per cent year-on-year.

The VND270 trillion ($11.5 billion) in bonds approaching maturity combined with the impact of shrinking credit lines are creating a great deal of concern at banks. The State Bank of Vietnam has also said that bad real estate debts are showing signs of increasing rapidly, reaching more than VND36 trillion ($1.5 billion) as of June 30, up 5 per cent compared to the end of 2021.

Data from FiinGroup shows that bond issuances fell sharply in July, to VND22 trillion ($945.1 million), down 48.2 per cent compared to June and 65 per cent year-on-year. Notably, 19 of the 24 bonds issued were unsecured and/or have shares as collateral.

Unlisted real estate companies have alarmingly low or very weak debt repayment capacity, while 28 out of 52 listed companies have been initially ranked as being weak or very weak in debt repayment capacity, according to recent market research from FiinGroup.

Forty-two corporate bond issuances were conducted in September, mobilizing VND29.734 trillion ($1.3 billion). The real estate group attracted VND8.394 trillion ($369.56 million) in private placements with high interest rates. Experts, however, have warned that this may be the beginning of a “Vietnamese Evergrande”.