FiinRatings – a Strategic Partner of S&P Global – has released its July 2025 Bond Spotlight: “Issuance volume slowed down after a surge in June.” After the strong momentum in June, Vietnam’s corporate bond market in July witnessed a sharp contraction in both issuance value and number of deals, mainly from the banking sector. At the same time, year-end maturity pressure has been mounting, particularly in real estate, while secondary market liquidity has remained stable, led by banks and real estate companies.

Macroeconomic Factors:

• The credit growth outlook remains strong toward year-end, which is a positive signal for the corporate bond market as banks have more room for both lending and investment in corporate bonds. The State Bank of Vietnam (SBV) has proactively raised credit growth quotas for banks to meet the rising capital demand for production activities in the second half of the year, as well as to achieve the 16% credit growth target for 2025. On the supply side, banks are also expected to increase bond issuance to supplement their medium- and long-term funding sources.
• The upcoming policy to remove the credit growth quota is expected to facilitate more efficient capital allocation across the economy at more reasonable interest rates. Banks will be able to determine the amounts of lending and corporate bond investments based on their financial capacity and risk management capabilities. The implementation of Circular 14/2025/TT-NHNN will further enhance banks’ risk management frameworks, thereby preparing them for safer credit expansion. Moreover, alternative funding channels (including corporate bonds) are expected to expand further, helping to reduce the economy’s increasing reliance on bank credit.
• The exchange rate remains elevated, reflecting pressures from the demand stimulus measures, tariff risks, and USD demand. However, it is anticipated to improve given significantly lower tariff levels, coupled with expectations of a potential FED rate cut as early as September. This environment creates favorable conditions for international bond issuance activities in the coming period.

Primary Market Activities:

• The market recorded a sharp decline in issuance value, reaching VND 44.2 trillion (-64.8% MoM) across 39 issuances (down 68 issuances compared to the previous month). Banks still accounted for as much as 88% of the total, though issuance value also declined after the peak issuance period aimed at balancing liquidity and improving the capital adequacy ratio.
• Bond repurchase activity during the month totaled VND 25.6 trillion, declining by 60% MoM, mainly driven by non-bank corporates. In the remaining five months of 2025, bond maturities are projected to reach VND 106.5 trillion, including repayment pressures from certain corporate bonds that had been extended or deferred into 2025.
• New problematic bonds (with delayed principal and/or interest payments) continued to decline in July, with an additional VND 2.8 trillion (-35.3% MoM), mainly from the real estate sector.

Secondary Market Activities:

• Secondary market transactions in July 2025 reached over VND 142.4 trillion, covering both private placements and public offerings. The average daily trading value declined nearly 28% MoM, to VND 4.7 trillion per day. Banking and real estate sectors continued to dominate, accounting for 76% of the market’s total trading value.

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