Exclusive-Vietnam considering first sovereign dollar bond sale since 2014, sources say

Hanoi, on September 15, Vietnam's finance ministry is contemplating holding its first sovereign dollar bond sale in over a decade, with investment banks engaged in discussions about potential terms, according to four sources familiar with the matter. Seeking to fund infrastructure projects and other initiatives, the country aims for an annual economic growth rate of at least 10 percent through 2030.

This move would alleviate pressure on Vietnamese banks, primarily responsible for lending domestic investments thus far. By issuing a dollar bond, Vietnam would demonstrate its growing openness to foreign financing, following the central bank's recent increase in the borrowing ceiling for the private sector and the government's agreement to accept foreign development loans.

One foreign investment bank has recommended issuing a $1 billion 10-year dollar bond, while another lender suggests a 10-year bond with an issuance size between $500 million and $1 billion and a coupon rate of approximately 7 percent. Nonetheless, the finance ministry has not yet made a definitive decision, as it evaluates borrowing costs amidst rising global yields driven by high oil prices and inflation.

Although the ministry did not provide a comment to Reuters, Vietnamese officials stated that the ministry is assessing the borrowing costs at a time of increasing global yields due to high oil prices and inflation.