Vietnam Bank for Agriculture and Rural Development (Agribank) announced to issue five million bonds to the public with a total value of five trillion dong. The interest rate for the first interest period of the bond is 8.1 percent per year.
Agribank said that the interest rate of Agribank 2019 bonds would always be 1.2 percent per year higher than the average of 12-month individual savings deposit rates of four commercial banks including: Agribank, Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) and Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank).
According to Agribank, the purpose of this bond issuance of Agribank is to boost more long-term capital to meet the demand for lending to the economy in general according to the approved business plan, especially for agriculture, rural and farmers, small and medium enterprises, medium and long-term investment projects have been committed to lending by Agribank; at the same time to increase Tier II capital to ensure safety ratios, and increase attractive and effective investment opportunities for customers.
Accordingly, Agribank issued five million seven-year bonds with face value of one million dong per bond. Bonds this time target to individual customers and businesses that find appropriate investment channels for their capital.
Agribank’s registration period is from August 9 to September 23, 2019 at all 2,300 branches and transaction offices nationwide and its issuing agent, Agribank Securities Joint Stock Company (Agriseco). Expected release date is September 24, 2019.
Also according to Agribank, in case of need for loans, bondholders can mortgage at Agribank or any other banks. Particularly at Agribank, with loans mortgaged by bonds, borrowers only have to pay interest rate difference at least 0.5 percent per year. In addition, bondholders have the right to transfer, sell, donate and inherit.
Agribank is a commercial bank with 100 percent state owned charter capital. By the end of August 2019, Agribank’s profit will reach 8.2 trillion dong (expected to reach at least 11trillion dong in 2019).
In the development strategy, Agribank aims to become one of the 150 banks with the largest asset size in Asia by the end of 2020. Currently, Agribank is in the process of implementing equitisation under the direction of government and SBV.
