Vietnam: Guidance on formulation of the scheme for issuance of municipal bonds

According to Circular No. 100/2015/TT-BTC of the Ministry of Finance of Vietnam, a scheme for issuance of municipal bonds includes the following basic contents:

- Purposes of the issuance of municipal bonds as regulated in Article 3 herein;

- Information about the list of investment projects which are granted approval by the Provincial-level People’s Council and will be funded by capital raised from the issuance of municipal bonds;

- The report on evaluation of the project’s ability to recovery investment capital (if it is a project capable of capital recovery);

- Planned terms and provisions of a municipal bond, including: quantity; term; face value;

- Planned time and methods of issuance of municipal bonds;

- The reality of raising funds and the repayment of principal and interests of loans borrowed from all sources of the provincial-government budget within 03 budget years preceding the budget year in which the municipal bonds are issued according to each method of capital mobilization as regulated by law;

- The limit on total amount of funds to be raised for the provincial-government budget at the time of formulation of the scheme as regulated in the Law on state budget, the Law on public debt management and their instructional documents;

- The plan for using funds to pay bond interest and principal upon their maturity date;

- Information provided to investors before the issue of municipal bonds as regulated in Article 8 herein.

More details can be found in Circular No. 100/2015/TT-BTC of the Ministry of Finance of Vietnam, which takes effect from August 01, 2015.

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