From June 19 to July 19, PetroVietnam Finance Company (PVFC) will issue corporate bonds worth of VND690 billion (US$43.13 million). On this occasion, Vietnam Business Forum had interviewed Mr. Nguyen Xuan Son, PVFC deputy director, about the operations of his company.
Can you introduce the financial capacity of PVFC on the current Vietnamese financial and monetary market?
PVFC operates as a financial institution wholly owned by Vietnam Oil and Gas Corporation (PetroVietnam) to serve investment projects of the oil and gas industry and take part in the financial and monetary market. Despite being set up 6 years ago, PVFC as secured its foothold on the financial market. In the first year, PVFC had a chartered capital of VND100 billion (US$6.25 million) but in 2003 its chartered capital climbed to VND300 billion. On April 26, 2006, PVFC official increased its chartered capital to VND1,000 billion, turning itself into the largest financial firm in Vietnam in terms of capital. The charter capital will be raised to VND5,000 billion in 2010. The current total asset value of PVFC is over VND10,000 billion.
Can you reveal PVFC’s investment fields?
PVFC mainly invests in the fields of oil, gas, energy, credit services, deluxe tourism and others. In 2006, PVFC plans to invest VND1,200 billion (US$75 million) and the profit from investment activities is estimated to reach VND30-40 billion (US$1.88-2.5 million). The oil, gas and energy fields will make up 65 per cent of the company’s aggregate investment value. At present, the company is investing in the construction of power plans like Song Vang in central Vietnam, Nam Chien Hydropower Plant and Pha Lai. In tourism, PVFC is investing in Cat Tien Sa Deluxe Tourism Zone and Thanh Hoa Eco-tourism Zone. Besides, other important activities of PVFC include consulting services, enterprise equitisation construction plan, corporate financial planning, IPO, listing on the stock market and one-member limited liability company transformation.
This is the second time PVFC issues bonds. Is there any difference between PVFC bonds and bonds of other firms?
In 2003, PVFC made the first bond issuance with a total value of VND300 billion. The second issuance totally valued VND690 billion is available in both VND denominations and UDS denominations. The oil and gas bond has an attractive interest rate of 9.05 per year for the first year for the VND denomination bonds and 5.1 per cent for USD domination bonds, higher than interests rates of State-run commercial banks. Hence, within the first issuing day, PVFC sold VND350 billion worth of bonds.
The oil and gas bonds have high liquidity. Clients are free to transfer bonds in the form of purchasing, selling, presenting, inheriting and mortgaging to borrow capital from PVFC. Especially, to facilitate oil and gas bonds on the stock market and increase the bond liquidity, PVFC is carrying procedures for the bond listing on the stock market in the third quarter of 2006. Investors of this issuance are prioritised to share investment opportunities with the company.
Can you reveal PVFC’s investment plans for the coming time?
We will continue focusing on investing in oil and gas projects, developing industrial zones, building ports and service areas in Dung Quat Oil Refinery, investing in Ca Mau Power-Fertiliser Plant and Phu My-Thu Duc gas pipeline project, expanding its sheep fleet and its service bases. Especially, PVFC will actively take part in power plant construction projects and other fields.
Lan Anh
Vietnamese
