ニュース
Vietnam to focus on quality, effective FDI projects
13-02-2012
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Industry insiders say much-touted policies on financial and monetary easing will not be available to them, while lenders even are seeking to recover funds already disbursed to property makers since years ago.
Continued mobilization hardship
In fact, the majority of property firms only have about 20% of invested capital by using their own equities when developing fresh projects. This means they have to borrow money from banks and customers to cover the remaining necessary capital, with the ratio of banking loans accounting for the majority.
Due to this huge reliance on mobilized funds, the property market is specially vulnerable upon any monetary policy change, as seen in the feverish or frozen situations.
Credit applications from industry players are now not accepted by lenders, who themselves are having difficulty recovering debts from realty projects. Due to the weak liquidity of the market, mobilizing capital from customers for new schemes is no longer easy like before.
Meanwhile, attracting fund via the stock market has faced the same difficulty.
Several realty businesses that in 2009 and 2010 had decided to list shares for better fund attraction failed to attract any fund from this channel last year as a result of the gloomy stock market. A series of property firms were forced to cancel share issuance plans for failing to lure buyers.
Therefore, the execution of many real estate projects has been suspended owing to developers being thirsty for funds.
Tran Minh Hoang, chairman of VinaLand Limited, said each property developer has to seek funds in their own way. Transferring land to other partners is also a recommended choice, Hoang suggests.
According to Hoang, land transferring is not a new trend as it has been seen through strategic investment cooperation among businesses so far, under which some company will transfer its project partly or wholly to partners.
For instance, Singapore-based CapitaLand Limited has invested in a project of Khang Dien Co., in HCMC’s District 2 and another one developed by Quoc Cuong Gia Lai Joint Stock Co. in Binh Chanh District. Similarly, Him Lam Land has poured capital into the Hyco4 Tower scheme in Binh Thanh District developed by another.
Market observers predict the land-transfer trend will continue this year but insist it is only feasible for totally new schemes rather than ongoing projects. Complicated transfer procedures and present economic downturn discourage merger and acquisition activities, they point out.
Meanwhile, Hoang of VinaLand notes that realty trust investment funds and housing saving funds have yet to be deployed owing to the absence of support from the local financial system.
No access to banking loans
Since last year, high bad debt ratios coupled with weak liquidity have prompted many banks to distant themselves away from lending real estate schemes, especially fresh ones.
Truong Van Phuoc, general director of the Vietnam Export Import Commercial Joint-Stock Bank (Eximbank), states that there is little room left for property credit growth at his bank. It is because Eximbank now concentrates on four groups that are no longer treated as non-productive segments including low cost-housing projects, Phuoc explains.
When asked about realty loans, a credit officer of the HCMC-based Bank for Foreign Trade of Vietnam (Vietcombank) reveals his bank will only disburse funds for property projects the bank has earlier pledged to finance
Nam A Commercial Bank’s general director Tran Anh Tuan asserts his bank mainly serves healthy and potential corporate customers besides actively collecting debts from property businesses within this year. Tuan hints at limited new disbursement for the property industry at his bank until the market recovers.
