In 2025, corporate bonds issued with credit ratings totalled around VNĐ10.2 trillion, 3.1 times higher than the 2024 figure but accounted for only about 1.6 per cent of total corporate bond issuance during the year. — Photo tapchitaichinh.vn

HÀ NỘI — The Ministry of Finance has proposed raising the minimum charter capital requirement for credit rating agencies to VNĐ25 billion (US$1 million) from the current amount of VNĐ15 billion as part of efforts to strengthen the regulatory framework on credit rating services amid changes in Việt Nam's capital and corporate bond markets.

The proposal is raised in a draft Government decree that would replace Decree 88/2014/NĐ-CP, which the ministry says has become outdated after more than a decade in force.

The ministry said five companies have so far been granted certificates to provide credit rating services, with charter capital ranging from VNĐ26.875 billion to VNĐ194.64 billion. It said raising the capital requirement would therefore not disrupt existing services.

The credit rating market remains small, the ministry said. By the end of 2025, credit rating agencies had signed 228 contracts, including 174 contracts to rate companies and issuers and 37 for internal management purposes.

Only 17 contracts involved debt instruments and corporate bonds, including 16 privately placed bonds and one publicly offered bond.

In 2025, corporate bonds issued with credit ratings totalled around VNĐ10.2 trillion, 3.1 times higher than the 2024 figure. The amount, however, accounted for only about 1.6 per cent of total corporate bond issuance during the year.

The ministry attributed the low uptake to volatility in the macroeconomic environment and investor sentiment, as well as a lack of awareness among some issuers about the role of credit ratings in fundraising. Companies have also been concerned about costs, the time required, potential disclosure of confidential information and the possibility of receiving ratings below expectations.

Demand for credit rating services is expected to increase from 2026 as the amended Law on Securities and Decree 245/2025 take effect, which made credit ratings mandatory for corporate bonds offered to the public and privately placed corporate bonds offered to individual investors.

Decree 245/2025 also allows international independent credit rating agencies, including Moody's, Standard & Poor's and Fitch Ratings, to rate issuers or bonds registered for offering under securities laws.

The ministry said the expansion of mandatory rating requirements would help boost demand for credit rating services and contribute to a safer and more transparent capital and bond market.

It will also put pressure on domestic credit rating agencies to improve service quality, financial capacity, human resources and data systems, the ministry said.

The proposed increase in minimum capital reflects the rising costs of operating credit rating businesses, the ministry said.

The ministry pointed out that Việt Nam's GDP was 2.1 times higher in 2025 than in 2014. Credit rating operating costs accounted for a significant share of agencies' total expenses.

The average annual operating cost of credit rating services at the three largest agencies by market share was estimated at around VNĐ22 billion in 2024, the ministry said.

Higher capital requirements would help ensure agencies' independence and objectivity, reducing the risk that ratings could be influenced by the fees paid for the service, the ministry said.

Under the draft, credit rating agencies would also have to maintain paid-in charter capital of at least VNĐ25 billion throughout their operations.

Beyond the capital requirement, the draft also sets additional conditions for credit rating firms, including having at least five members of a credit rating committee and at least five qualified analysts.

Notably, credit rating agencies would be prohibited from operating in accounting and auditing, securities activities such as brokerage, investment consultancy, underwriting and securities distribution agency services, fund management, portfolio management and securities investment, as well as banking.

The restrictions are aimed at limiting conflicts of interest and ensuring the independence and objectivity of credit rating activities. — VNS