Fitch ups Military Bank

Fitch Ratings said it upgraded Military Commercial Joint Stock Bank’s long-term issuer default rating to B+ from B with a stable outlook and viability rating to b+ from b.

At the same time, the agency upgraded the viability ratings of JSC Bank for Foreign Trade of Vietnam (Vietcombank) and Vietnam JSC Bank for Industry and Trade (Vietinbank) to b from b-.

The long-term issuer default ratings of Vietnam Bank for Agriculture and Rural Development (Agribank), Vietinbank and Vietcombank were affirmed at B+ with a positive outlook. The issuer default rating of Asia Commercial Joint Stock Bank (ACB) was affirmed at B with a stable outlook.

Fitch said the positive action takes into account the Vietnamese banking system's enhanced operating environment, with improved economic policy-making from authorities promoting macroeconomic stability and predictability.

“This has enabled banks to significantly reduce their exposure to legacy problem loans that have long weighed on their balance sheets and offsets, in part, the banking system's long-standing structural weaknesses – such as thin capital buffers and weak profitability – which we expect to be more adequately addressed over the longer-term,” the agency said in a news release.

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