14:51 (GMT +7) - Tuesday 20/11/2018

Banking & Finance

Moody raises OCB rating to B1

Released at: 11:14, 27/08/2018 BUSINESS SPOTLIGHT

Moody raises OCB rating to B1

Photo: OCB

Bank's long-term counterparty risk rating up from B2 to B1.

by Khanh Chi

Moody’s Investors Service has upgraded the Orient Commercial Joint Stock Bank (OCB)’s long-term counterparty risk rating (CRR) from B2 to B1, in the context of Vietnam’s economy also being assessed by the organization as having potential for strong economic growth, driven by the increasingly effective use of labor and capital.

The long-term CRR is an index rated by Moody’s based on the completion of OCB’s ability and prestige to perform its commitments and financial obligations of non-guaranteed assets to counterpart. This helps OCB affirm stable belief, create peace of mind, and insurance to the customer.

OCB is now an impressive bank with high growth rates in all aspects, from capital mobilization to credit quality and service business. In the first six months of 2018 it recorded some $56 million in pre-tax profit, up 2.6-times year-on-year and fulfilling 65 per cent of the annual plan. Profit was at $29.3 million in the second quarter.

The bank is in the process of focusing on the implementation of a development strategy for the 2015-2020 period, expanding its transaction network, enhancing competitiveness, and strengthening risk management activities, making it a modern bank and a leader in retail banking and banking for small and medium-sized enterprises (SMEs) in Vietnam.

OCB has received two awards from the International Finance magazine: Most Innovative Digital Bank Vietnam 2018 and Best New Omni Channel Platform, for its breakthroughs in applying science and technology into its banking activities in 2018.

Moody’s recently also upgraded the long-term local and foreign-currency deposit and issuer ratings of Vietcombank, BIDV, and VietinBank. Similarly, it upgraded the long-term CRR and counterparty risk assessments (CRAs) of VietinBank and BIDV and affirmed those of Vietcombank.

The rating actions follow Moody’s upgrade of Vietnam’s sovereign rating to Ba3 from B1 and change in outlook for the sovereign’s rating to stable from positive.

The credit ratings, assessments, and outlooks assigned to the other two Moody’s-rated banks in Vietnam are unaffected by the upgrade and change in outlook of Vietnam’s sovereign rating. These two unaffected banks are the Saigon Thuong Tin Commercial Joint Stock Bank (Caa1 negative, caa2) and the Vietnam Maritime Commercial Joint Stock Bank (B3 stable, caa1).

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