80 percent of BOL’s 5-trillion-kip bonds sold

Some 80 percent of the 5-trillion-kip worth of bonds issued by the Bank of the Lao PDR (BOL) have been sold since they were first offered on June 15.
The saving bonds offer an annual interest rate of 20 percent which is attractive not only to individuals but also to businesses.
According to the central bank, bonds worth over 4 trillion kip out of the total 5 trillion kip on sale have been snapped up over the past 45 days (from June 15 to August 17).
Some 42 percent of the bonds have been bought by individuals through nine assigned banks in Laos, while another 38 percent were purchased by companies and other legal entities.
The sale of the kip bonds is designed to enable members of the public to invest in securities and generate a safe and sizeable profit, as well as supporting the government’s monetary policy and efforts to stabilise the value of the kip.
The money earned from the sale of the bonds will assist the government to forge ahead with socio-economic development and tackle its economic, financial and currency problems.
The bonds were sold through BCEL, Lao Development Bank (LDB), Agriculture Promotion Bank (APB), Joint Development Bank (JDB), Phongsavanh Bank, ST Bank, BIC Bank, Lao-Viet Joint Venture Bank, and ICBC Bank.
More than 1 trillion kip worth of bonds were sold in the northern provinces of Phongsaly, Luang Prabang, Xayaboury, Luang Namtha, Bokeo, Oudomxay, Huaphan and Xieng Khuang.
Bonds worth a further 2.42 trillion kip were sold in Vientiane and the provinces of Vientiane, Borikhamxay, Xaysomboun, Khammuan and Savannakhet.
In addition, bonds worth more than 483 billion kip were sold in the southern provinces of Saravan, Xekong, Attapeu and Champassak. 
The par value of the bonds begins at 100,000 kip per unit. Individuals can buy bonds up to a maximum value of 2 billion kip, while a legal entity such as a company can buy bonds up to a maximum worth of 10 billion kip.
According to the BOL, bonds are the safest form of investment because the central bank guarantees the repayment of the principal and interest as stated in the bond certificate.
The issuing of bonds is a mechanism used by the central bank to rebalance the amount of money in circulation in response to the need for socio-economic development.  

By Somsack Pongkhao
 (Latest Update August 24, 2022)