The sustainable bond market in Vietnam reached US$800 million at the end of March, according to a new report by the Asian Development Bank (ADB).

Banks will need to issue new Tier-2 capital bonds to replace maturing bonds and bolster their capital adequacy ratios, said experts.

ASEAN markets recorded $19.1 billion of sustainable bond issuance last year, accounting for 7.9 per cent of aggregated issuance in ASEAN+3 sustainable bond markets.

A high value of bonds will mature in 2024, including VND155 trillion, or $6.3 billion, worth of real estate bonds.

Many real estate firms have issued corporate bonds to mobilize trillions of dong worth of capital to pay bond debts. Some of them want to finalize all debts, while others need more time for restructuring.

More companies reported delaying paying principal and interest on bonds in the second quarter, with a total outstanding payment of nearly 24.3 trillion VND (1.02 billion USD) due, according to a report on corporate bonds from MBS Research.

The Government has assigned the Ministry of Finance to study a proposal to allow the State Bank of Vietnam to guarantee payment of bank bonds, just like with bank deposits.

The government bond yields in Vietnam have dropped across all tenors from March to June, resulting in the largest downward shift in the country’s bond yield curve among Asian nations, with an average decline of 136 basis points.

Vietnam’s local currency bond market grew 2.6 percent to 52.9 billion USD in the second quarter of this year, after a 0.7 percent expansion in the first quarter.