The State Bank of Vietnam has issued Circular No. 03/2023/TT-NHNN, which suspends the implementation of Clause 11 Article 4 of Circular No. 16/2021/TT-NHNN dated November 10, 2021, that regulates credit institutions and foreign bank branches buying and selling corporate bonds.
During the suspension of the implementation of Clause 11 Article 4 of Circular No. 16, credit institutions and foreign bank branches are allowed to repurchase unlisted corporate bonds that have not been listed on the stock market or registered for trading on the UpCom trading system.
These unlisted corporate bonds must have been previously sold by credit institutions, and/or issued in the same lot/same issuance of unlisted corporate bonds that a credit institution has sold, as long as they meet the provisions of Article 4, Circular No. 16/2021/TT-NHNN.
The buyer of these corporate bonds from a credit institution must pay the entire amount of the purchase at the time the credit institution signs a contract to sell the corporate bonds. Bond issuers must have the highest credit rating according to the credit institution’s internal credit rating regulations at the latest time before the credit institution buys the corporate bonds.
The issuance of Circular No. 03/2023/TT-NHNN aims to increase liquidity, remove difficulties, and promote the development of the corporate bond market in the current challenging situation, following the Government’s policy and the Prime Minister’s direction.