Fitch assigns ANZ Vietnam first-time 'BB' rating; outlook positive
ANZ Vietnam's Long-Term Foreign Currency IDR is capped at the Vietnamese Country Ceiling, which is ‘BB’ now.
Fitch Ratings has assigned a first-time Long-Term Foreign-Currency Issuer Default Rating (IDR) of 'BB' and Long-Term Local-Currency IDR of 'BBB-' to ANZ Bank (Vietnam) Limited (ANZV). The outlook is positive.
“The Positive Outlook reflects our Outlook on the Vietnam sovereign (BB/Positive),” Fitch said in a note on Monday.
ANZV's Long-Term Foreign Currency IDR is capped at the Vietnamese Country Ceiling, which is ‘BB’ now.
| An ANZ branch in Vietnam|
The rating agency said ANZV's ratings are support driven. Fitch believes that the bank's parent Australia and New Zealand Banking Group Limited (ANZ, AA-/Negative/aa-) has a strong ability to extend extraordinary support to its Vietnam subsidiary - given the parent's credit profile, and ANZV's small asset base that accounted for only around 0.2% of the parent's total assets at end-2018.
Nevertheless, Fitch analysts believe that currency transfer and convertibility risks, as reflected in Vietnam's Country Ceiling of 'BB', could represent a significant constraint on ANZV's ability to receive support from its Australia-based parent. This is reflected in the Support Rating of '3' that indicates a moderate probability of support from its higher-rated Australia-based parent, in times of need.
“Fitch regards the risk of sovereign restrictions on local-currency repayments as lower than that of foreign-currency restrictions. We also expect parental support to be robust, assuming no very high levels of sovereign or macroeconomic stress. Hence, ANZV's Long-Term Local-Currency IDR is rated two notches above Vietnam's sovereign rating,” said the note.
The rating’s view on ANZ's propensity to provide support to ANZV is based on ANZV's relatively limited role in the group, compared with larger subsidiaries in more strategically important markets.
- Vietnam finance ministry proposes VAT cut to aid business recovery
- Gov’t extends payment deadlines for US$5.3 billion worth of land rental fees in 2021
- FLC Chairman banned from the stock market for 5 months
- Vietnamese banks urged to tighten lending in real estate, securities
- Digital-first strategy to be focus among Vietnam’s banks and fintech by 2025
- Stocks sale annulment of FLC Chairman necessary to maintain market order: SSC
- M&A in Vietnam’s technology sector to boom in 2022
- ADB, TPB join hands to finance women-led SMEs in Vietnam
- Banking sector to lower lending rates in 2022: Deputy Prime Minister
- Vietnam's credit growth expands by 13% in 2021
Kitchen God farewell ritual starts traditional Tet Holiday
Vietnam's green commitment supports global fight against climate change
Vietnam's tourism to be fully restored by April 30
PM asks ministries to consider reopening of cinemas nationwide
Hanoi: Hang Luoc Flower market opened
Face-to-face schooling resumption urged in the new normal
Funeral of Vietnamese peacekeeper die on duty
Grand old peach trees grace Hanoi’s streets
Culinary film festival to open virtually in Vietnam