HCMC Proposes to Raise Municipal Bond Interest Rate

Municipal bonds attract more and more investors (Photo: TC)

Ho Chi Minh City (HCMC) People’s Committee has just asked the Ministry of Finance to adjust interest rate of HCMC municipal bonds from May 2006 for the bonds with terms of five, ten and fifteen years. 

Accordingly, interest rate of HCMC municipal bonds will be equal to that of the Government’s bonds plus 0,3%/year.

The adjustment is aimed to make HCMC municipal bond issuances successful, helping with the mobilization of capital for investment and development of the city and meeting capital demands.

The floor interest rate of HCMC municipal bonds with all terms in April 2006 was 0,2%/year, lower than that of last year. While the interest rate of the Government’s bonds of the same term remained unchanged.

Due to the low floor interest rate, which has not met investment needs and the current market situation, HCMC municipal bonds do not appeal to investors.

By H.Nh – Translated by Yen Chuong

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