Vietnam empowers local authorities to supervise corporate bond issuances

Under Decree 200, provincial and municipal People's Committees in Vietnam are now tasked with supervising corporate bond issuances within their jurisdictions. This new regulatory layer aims to close management gaps by allowing local authorities to monitor, inspect, and report on bond activities to the Ministry of Finance.

Hoang Van Thu, Vice Chairman of the State Securities Commission, noted that local involvement facilitates early detection of irregularities due to their proximity to businesses. This creates a multi-tiered oversight mechanism involving information disclosure, post-issuance inspections, and enforcement.

Additionally, the decree introduces stricter financial controls, including a limit on the debt-to-equity ratio at five times. These measures are intended to help businesses manage financial risks and maintain transparency throughout the lifecycle of their debt obligations.