Vietnam’s credit rating upgrade affirms steady improvement: ANZ

HANOI – The decision by Moody’s to raise Vietnam’s credit rating to B1 from B2 - Vietnam’s first upgrade since it was subjected to a slew of rating cuts in 2010 – is an affirmation that Vietnam’s recovery is stable, though slow, says ANZ Bank. Moody’s cited an emerging track record of macro-economic stability as the main driver of its credit action.

ANZ says Vietnam is on a path to slow but steady improvement, with economic activity expanding at a more sustainable rate - although lower than its 10-year average of around 7%.
“Although the progress in Vietnam’s macroeconomic story is increasingly being recognised, the fact remains that much more needs to be done,” ANZ says, adding that Vietnam is still within the highly speculative rating range.
“Vietnam is now four notches away from the highly coveted investment grade status. Resolution of the high nonperforming loans in the banking system is a key to unlocking Vietnam’s full economic potential.” www.live.anz.com (ATI).