GuarantCo has provided a guarantee to Hoa Binh – Xuan Mai Clean Water Limited Liability Company and Xuan Mai – Hanoi Clean Water Transmission Limited Company. Hoa Binh -Xuan Mai has issued 20-year green bonds to fund the development of a greenfield water supply project in Hoa Binh province to supply clean water primarily to the Hanoi region.

This is Vietnam’s first-ever verified green project bond in the water sector, the longest-tenor project bond issuance in the country to date, and the first project bond in Vietnam to receive an external credit rating from a local ratings agency.

This transaction marks GuarantCo’s fifth transaction in Vietnam, demonstrating its continued commitment to the country in supporting the development of sustainable infrastructure and local capital markets. While it is the first time GuarantCo has provided guarantees to support the development of water treatment infrastructure globally.

The green bonds received oversubscription from major institutional investors, and were invested by Chubb Life Vietnam, Hanwha Life, AIA, and Generali. Chubb Life Vietnam, as the anchor investor provided the largest subscription to the bonds, and Hanwha Life are first-time investors in GuarantCo guaranteed bonds.

The bond issue is rated AAA by FiinRatings under the national credit rating scale – a rating uplift of 11 notches – reflecting the strength of GuarantCo’s guarantee. The bond has also been structured in alignment with ICMA’s Green Bond Principles.

Hoa Binh- Xuan Mai has committed to allocating capital raised from the green bonds to green water treatment capital expenditure projects. The project comprises water intake, treatment, pipeline and distribution components with a total capacity of 150,000 cubic metre per day.

The project represents a key step in the Vietnamese government’s efforts to transition away from groundwater sources, which can be environmentally harmful. By using river water as feedstock, Hoa Binh – Xuan Mai project is not only embracing a more sustainable environmental approach but also ensuring a higher quality of water, which will positively impact public health and well-being.

Its goal remains to promote sustainable and environmentally friendly clean water treatment from surface water sources, which aligns with and contributes to multiple sustainable development goals (SDGs), including SDG 6 (Clean Water and Sanitation).

Hoa Binh is one of two project components of the Hoa Binh Xuan Mai water treatment plant. The second – Xuan Mai Ha Noi – will issue VND 317.2 billion (c. USD 12.5 million) bonds in 2025 to fund the associated pipeline and distribution components.