VPI Issues Additional VND 150B Bond at 11.5% Interest, Uses Own Shares as Collateral

Overview

Van Phu Real Estate Development Corporation (VPI) has issued an additional VND 150 billion in bonds on June 2, 2026, with a 3-year term and an 11.5% interest rate, using VPI shares as collateral. This marks the company’s third bond issuance in two months, bringing total bond proceeds to VND 480 billion since late April. The move underscores VPI’s reliance on debt financing amid a challenging real estate market.

Key Facts

• VPI issued 1,500 bonds (code VPI12603) with a face value of VND 100 million each, totaling VND 150 billion.
• The bonds have a 3-year term, maturing on June 2, 2029, with an interest rate of 11.5% per annum.
• Collateral consists of VPI shares owned by THG Holdings (a related party) and other insiders.
• This is the third bond issuance in 2026: VND 150 billion on April 23 (VPI12601), VND 180 billion on May 7 (VPI12602), and VND 150 billion on June 2 (VPI12603).
• As of March 31, 2026, VPI had total borrowings and finance leases of over VND 6,908.9 billion, including bond debt of over VND 2,584 billion.
• The company’s stock closed at VND 58,800 on June 8, 2026, down 0.68% with volume of 1,364,700 shares.

What Happened

Van Phu Real Estate Development Corporation (VPI) reported the results of its private bond offering to the Hanoi Stock Exchange (HNX). The company issued 1,500 bonds with a face value of VND 100 million each, raising VND 150 billion. The bonds were fully subscribed and settled on June 2, 2026, with a 3-year term and a combined interest rate of 11.5% per annum, including a call option.

The issuance was approved by the Board of Directors on May 28, 2026, under Resolution No. 2805/NQ-HDQT. The bonds are secured by VPI shares owned by THG Holdings (a related party) and other insiders. This follows two earlier issuances in April and May 2026, also secured by shares of Chairman To Nhu Toan and his wife, Dao Thi Hong Hanh, as well as THG Holdings.

Market Context

VPI shares closed at VND 58,800 on June 8, 2026, down 0.68% on volume of 1.36 million shares. The stock has been under pressure amid a broader real estate sector slowdown and rising interest rates. The company’s aggressive bond issuance at a high coupon rate of 11.5% reflects tight liquidity conditions and limited access to cheaper funding. As of March 31, 2026, VPI’s total bond debt stood at over VND 2,584 billion, with VND 797 billion in long-term bonds due within the year. The company is listed on HOSE.

Strategic Significance

The repeated use of VPI shares as collateral for bonds indicates that the company is leveraging its equity to raise debt, potentially diluting shareholder value if defaults occur. The high interest rate (11.5%) suggests that VPI faces elevated credit risk and is paying a premium for funding. This strategy may be necessary to finance ongoing projects or refinance existing debt, but it increases financial leverage and interest expense. For long-term investors, the sustainability of this debt accumulation and the company’s ability to service its obligations are key concerns.

What to Watch

• Upcoming bond maturities: VND 797 billion in long-term bonds due within one year as of March 31, 2026.
• Q2 2026 earnings report: expected to show impact of higher interest costs on net profit.
• Any further bond issuances or refinancing announcements.
• Changes in VPI’s share price and collateral value, which could trigger margin calls or forced sales.
• Regulatory developments regarding private bond offerings and collateral requirements.