Electricity of Viet Nam (EVN) plans to issue bonds in the amount of VND350 billion (US$22 million) during March 20-24 to raise funds for hydroelectric projects, said Dang Phan Tuong, head of the corporation’s equitisation board
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Electricity of Viet Nam (EVN) plans to issue bonds in the amount of VND350 billion (US$22 million) during March 20-24 to raise funds for hydroelectric projects, said Dang Phan Tuong, head of the corporation’s equitisation board.
The bond issue is part of a plan to mobilise VND2-3 trillion ($126-189 million) for power projects for this year, and it is viewed as a watershed for the State-owned utility to issue bonds on the international financial market.
EVN bonds will have a face value of VND100,000 ($6.25) with a five-year term. The interest rate for the first year is 9.6 per cent and will be equal in subsequent years to the average interest rate for 12-month term deposits at four State-owned commercial banks, plus 1.2 per cent.
The Industrial and Commercial Bank (Incombank) will guarantee the bonds, while the bank’s Securities Trading Co will be the agent for the first issue.
EVN bonds can be sold to Vietnamese citizens, overseas Vietnamese, foreigners working and living legally in
To ensure financial resources for the construction of power plants during 2005-10, EVN has been authorised to release bonds in dong denominations with a total value of more than VND4.6 trillion ($293.5 million), the corporation said.
By issuing bonds, EVN can save 1.55 per cent over the costs of borrowing from banks, equivalent to VND116.25 billion ($7.33 million) over five years, Tuong said.
EVN’s total assets grew 15 per cent on average annually while its capital increased nearly 12 per cent during 2002-04. The corporation’s net profits also rose 7.5 per cent annually in this period.
(Source: VNS)
