“The positive rating action takes into account the Vietnamese banking system’s enhanced operating environment, with improved economic policymaking from the authorities promoting macroeconomic stability and predictability,” Fitch noted in a report released on February 27.
According to Fitch, the Vietnamese Government will support Agribank when necessary as the bank plays an important role in the country’s banking system and is one of the four largest banks in Vietnam in terms of total assets and networking.
The positive outlook also reflects Fitch’s views on Vietnam’s improvement in providing support when necessary.
As of December 31, 2017, Agribank had reported a 20% increase in profit at a record VND5.01 trillion (US$220.44 million). The bank’s total assets also hit nearly VND1.2 quadrillion (US$52.8 billion) and its mobilised capital was close to VND1.1 quadrillion (US$48.4 billion). The bank also contributed VND1.2 trillion (US$52.8 million) to the State budget.
Through the ratings, Fitch also affirmed the long-term IDRs of Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) and Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) at ‘B+’ with a positive outlook.
The viability rating of the two banks was upgraded to ‘B’ from ‘B-’.
Meanwhile, the long-term IDR of the Military Commercial Joint Stock Bank (Military Bank) was upgraded to ‘B+’ from ‘B’ with a stable outlook.
