Vietnam Weighs First Sovereign Dollar Bond Since 2014

Vietnam's finance ministry is weighing its first sovereign dollar bond sale in more than a decade, holding discussions with investment banks about possible terms, according to people familiar with the matter.

The move would mark a return to international debt markets for the first time since 2014, when Hanoi raised $1 billion through a 10-year dollar bond carrying a 4.8% coupon. Earlier offshore issues were sold in 2010 and 2005.

Proceeds from a new sale would be directed toward infrastructure and other projects, as the country pursues annual economic growth of at least 10% through 2030. A dollar bond would also ease the funding burden on Vietnamese banks, which have served as the primary source of lending for domestic investment.

At least two foreign lenders have put forward proposals. One investment bank has recommended a $1 billion 10-year dollar bond, while another has suggested a 10-year issue sized between $500 million and $1 billion with a coupon of around 7%.

No final decision has been made. Officials are assessing borrowing costs at a time when global yields are elevated amid high oil prices and inflation, two Vietnamese officials said. The finance ministry did not respond to a request for comment.

So far this year, Vietnam has sold more than $9 billion in government bonds on the domestic market, with an average coupon of 4.2% on 10-year debt. Issuance volume is in line with the same period last year, but the average coupon on 10-year paper has risen from 3.1%.

The country's public debt burden remains relatively low, estimated at around 37% of gross domestic product last year. Vietnam has traditionally been cautious about overseas borrowing and has kept tight controls over its financial system.

That posture has softened in recent months as the Communist Party, under General Secretary To Lam, pushes for strong growth amid uncertainty over global trade, a key driver of Vietnam's export-dependent economy.

Vietnamese banks have seen credit growth outpace deposit growth since at least 2021, according to the central bank. To ease the pressure, the State Bank of Vietnam raised the ceiling for private-sector foreign borrowing to $6.1 billion this year, up from $5.5 billion in 2025. The cap could be revised higher later this year as banks seek approval for overseas borrowing plans, one official said.

Corporate borrowers have also turned to foreign markets. VPBank signed a $1.44 billion offshore loan with foreign lenders in June. Vingroup, the country's largest conglomerate, issued a $350 million bond with a five-year maturity and a 5.75% coupon on the Vienna Stock Exchange in April, and plans to raise 455 billion won ($338 million) this year through three-year bonds sold to South Korean investors with an 8% coupon.

At the government level, Vietnam has agreed this year to take development loans from Japan and Germany, after declining billions of dollars in development financing in recent years.