Vietnam Currency Discussion Board

[buckets]

Vietnam's banking industry risk assessment raised, says S&P
04.23.07, 8:04 AM

MUMBAI (Thomson Financial) - Standard & Poors Ratings Services has raised its Banking Industry Country Risk Assessment (BICRA) on Vietnam citing improving infrastructure and better economic risk environment.

The ratings agency raised Vietnam's BICRA to Group 9 from Group 10, where it joins countries like Russia, Costa Rica and Guatemala.

S&P noted that political constraints stemming from a highly opaque and centralized decision-making process are slowing Vietnam's transition to a market economy and its main challenge is to rectify the prevailing structural, institutional and legal deficiencies.

'Vietnams transition to a market economy remains cautious and gradual, but favourable endowments, high saving and investment ratios and strong export potential provide a solid basis for medium-term growth prospects,' said S&P credit analyst Ritesh Maheshwari.

The ratings agency said state-owned commercial banks dominate the banking industry, accounting for about 70 pct of bank credit in Vietnam.

[e-mail]

http://www.forbes.com/afxnewslimited/feeds/afx/2007/04/23/afx3639850.html