Banks permitted to be distribution agents of government bonds from January 15, 2024 in Vietnam

Banks permitted to be distribution agents of government bonds from January 15, 2024 in Vietnam

Decree No. 83/2023/ND-CP has amended Article 17 of Decree No. 95/2018/ND-CP on the private placement of government bonds.

Specifically, private placement means the direct sale of government bonds to each buyer or the selection of a commercial bank or foreign bank branch to be a government bond distribution and payment agent (hereinafter referred to as “distribution agents”) in service of buyers.

(Previously, according to Article 17 of Decree No. 95/2018/ND-CP, private placement meant the direct sale of government bonds to each buyer)

Additionally, Decree No. 83/2023/ND-CP has added the conditions for being distribution agents of government bonds as follows:

- Being commercial banks or foreign bank branches established and operated legally in Vietnam with functions of providing bond issuance agent services according to the Law on Credit Institutions 2010 and guidelines of the State Bank of Vietnam;

- Having operational networks appropriate for government bond distribution and payment;  

- Having schemes for bond distribution and payment meeting the requirements of the issuers for each issuance.

Additional fundamental contents of private placement of government bonds

According to Clause 2 Article 17 of Decree No. 95/2018/ND-CP, amended by Decree No. 83/2023/ND-CP, schemes for the private placement of government bonds have the following fundamental contents:

- Bond buyers;

- Planned quantity of bonds to be issue;

- Bond term;  

- Planned interest rate;

- Planned issuance date;

- Planned methods of private placement (State Treasury shall issue bonds directly or select a distribution agent).

(“Planned methods of private placement (State Treasury shall issue bonds directly or select a distribution agent)” has been added compared to Clause 2 Article 17 of Decree No. 95/2018/ND-CP)

See more details in Decree No. 83/2023/ND-CP, effective as of January 15, 2024.

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