31 Aug 2012 Intellasia Finance Vietnam - Hong Kong Business ...

FINANCE
Vietnam finance & business 31 August 2012
TEXT-S&P summary:
Bank for Investment
and Development of
Vietnam
Foreign currency
credit falls in city
Besides, on August 30, a loan worth 3.683 trillion dong on OMO pumped by the central
bank on August 23 to support liquidity for commercial bank also fell due.
Thus, the central bank continued a net withdrawal of 3.587 trillion dong on OMO after
a net withdrawal of 12.196 trillion dong in two days earlier.
Liquidity of banks has been stable again, therefore the interbank interest rate also
dropped strongly. On August 30, the overnight interest rate was only 3.63 percent p.a.,
down 0.87 percent p.a. from a day earlier, one week at 4.19 percent p.a. and one month
at 7.25 percent p.a., the lowest level in the past 10 days.
31/AUG/2012 INTELLASIA | REUTERS
(The following statement was released by the rating agency)
Summary analysis - Bank for Investment and Development of Vietnam 30-Aug-2012
CREDIT RATING: B+/Stable/B Country: Vietnam
Primary SIC: Commercial Banks
Credit Rating History:
Local currency Foreign currency
08-Dec-2011 B+/B B+/B
23-Dec-2010 BB-/B BB-/B
22-Jul-2010 BB/B BB/B
Ratings Score Snapshot
Issuer Credit Rating B+/Stable/B
SACP b
Anchor b
Business Position Strong (+1)
Capital and Earnings Very Weak (-1)
Risk Position Adequate (0)
Funding and Liquidity Average
and Adequate (0)
Support +1
GRE Support 0
Group Support 0
Sovereign Support +1
Additional Factors 0
Outlook
The stable outlook reflects our expectation that BIDV will maintain its financial profile
amid challenging operating conditions in Vietnam and improve its risk management
systems.
We could downgrade BIDV if: (1) we lower the sovereign rating on Vietnam ; (2) the
bank's asset quality declines substantially; or (3) its RAC ratio falls below 2 percent.
We could upgrade BIDV if we raise the sovereign rating on Vietnam and the bank's
stand-alone credit profile improves. Any large capital raising activity, including a strategic
sale of a stake in BIDV, such that the bank's RAC ratio increases to above 3 percent,
could improve its stand-alone credit profile to 'b+'.
http://www.reuters.com/article/2012/08/30/idUSWLA253720120830
31/AUG/2012 INTELLASIA | SAIGON TIMES DAILY
Whilst dong credit in HCM City by end-July grew 2.11 percent from late 2011, foreign
currency credit dwindled by 4.24 percent, according to the data of the central bank's
branch in HCM City.
As of end-May, dong outstanding loans in HCM City dipped 0.72 percent against the
end of 2011, while loans in foreign currency inched up 1 percent. However, foreign
currency credit began to fall in June, when dong deposit rate ceiling was lowered to
below 9 percent per year.
Nguyen Hoang Minh, deputy director of the central bank's HCM City branch, said it
was normal that the demand for US dollar slowed down in the last two months, as the
gap between dong and dollar lending rates was narrowed.
Intellasia 31 August 2012 7 / 46