Q1/2026 Vietnam Corporate Bond Market Spotlight: Issuance Activity Under Pressure from a High-Interest-Rate Environment

Corporate bond issuance value in Q1/2026 increased year-on-year but moderated compared to previous quarters. Nevertheless, the persistently high interest-rate environment continues to put upward pressure on funding costs, directly affecting corporates’ capital-raising activities.

Will the corporate bond market regain momentum from Q2 as seen in previous cycles, or enter a more gradual recovery phase under prolonged high interest rates?

FiinRatings’ Q1/2026 Corporate Bond Market Spotlight provides an in-depth analysis of issuance dynamics, interest rate trends, and market prospects amid rising funding costs and persistently high bond maturity pressure in the coming quarters.

Key highlights:

🔹 Issuance activity slowed in Q1: Total issuance value reached VND 40.3 trillion, up 60.6% YoY but still significantly lower than previous quarters due to seasonal factors. However, unlike prior years, the market is unlikely to rebound sharply from Q2 as interest rates are expected to remain elevated.

🔹 Bond issuance costs increased noticeably: In Q1/2026, average coupon rates rose by 68bps for credit institutions and 40bps for real estate issuers, indicating that issuers have had to accept higher coupon costs in order to access the bond market.

🔹 Corporates continue to face elevated funding costs: Liquidity pressure, together with narrowing banking sector margins, is limiting the room for a rapid decline in deposit and lending rates. As a result, corporates are expected to continue facing high funding costs across both bank credit and corporate bond channels.

🔹 Public issuance offers funding cost advantages but remains overshadowed by private placements: Among non-financial corporates, both primary market coupon rates and secondary market yields-to-maturity (YTM) are generally lower for public offerings. Nevertheless, private placements still accounted for more than 90% of total issuance value due to faster execution timelines and greater structural flexibility.

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