Moody’s assigns B2 to HDBank

Moody's Investors Service said it assigned the following first-time ratings and assessments to Ho Chi Minh City Development JSC Bank (HDBank): (a) Long-term local and foreign currency deposit and issuer ratings of B2; (b) short-term local and foreign currency deposit and issuer ratings of Not Prime; (c) baseline credit assessment (BCA) and adjusted BCA of b3; and (d) counterparty risk assessments of B2(cr)/NP(cr).

The outlook on the long-term ratings is stable.

Moody’s said the B2 long-term ratings reflect: (a) HDBank’s BCA of b3; and (c) a one-notch uplift based on the agency’s expectation of a moderate probability of support from the Government of Vietnam (B1 stable), in case of stress.

The b3 BCA captures the bank’s modest solvency profile, balanced somewhat by moderate funding and comfortable liquidity position. The BCA also takes in account Moody's expectation that the bank's asset quality and capital profile will weaken over time from its aggressive loan growth strategy, the agency explained.

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