Global ratings agency Moody's gave B3 ratings to the debt and deposit of the Vietnam Prosperity Joint Stock Commercial Bank (VPBank) in both local and foreign currency for the first time, saying the outlook was stable.

The ratings took into consideration VPBank's relatively advanced governance standards and progressive management plan to modernise credit risk management and operational controls.

The baseline credit assessment (BCA) also reflected the bank's need for external capital, exposure to other Vietnamese banks and aggressive turnaround plan, which involves inherent execution and asset quality risks.

Based on reported loans alone, VP Bank's current loan mix is 48 percent retail, 43 percent SME and 9 percent corporate.

VPBank has one of the lowest loan exposures to SOE, which accounts for only three percent of its overall loan book. Its retail banking strategy targets residents of Ho Chi Minh City and Hanoi with monthly incomes between 225 - 749 USD.

In addition to loans, the bank has rapidly enlarged its deposit base, which grew by over 100 percent between 2011 and 2012 and 29 percent so far in 2013.

Nguyen Duc Vinh, the bank's general director, said the bank has focused on the retail banking segment and SMEs over the past three years with support from world leading consulting firm McKinsey.

By the end of last month, its charter capital was 7 trillion VND with 200 units in 33 provinces and cities nationwide.

The bank's total asset size of 103 trillion VND (4.9 billion USD) positions it as a mid-tier joint stock commercial bank. It aims to become one of the three biggest commercial banks in the country.

Source: VNA