Moody’s: Vietnam’s banks show diverging capital profilesThe profitability of Vietnamese banks is strengthening as robust economic growth fuels credit demand and supports an improvement in asset quality, but challenges are also apparent, Moody’s Investors Service says in a recent report. — Photo tapchitaichinh.vn"Credit growth is outpacing internal capital generation, weighing on capital ratios, and the State-owned banks – unlike their private-sector counterparts – have been slow in raising external capital even as their capital ratios slide," says Rebaca Tan, a Moody’s analyst. "Against such a backdrop, a continued deterioration of capitalisation will weaken the competitiveness of the State-owned banks and ultimately their credit profiles," says Tan. By contrast, state-owned banks have been slow in raising external capital even as their capital ratios slide – primarily because the government prefers strategic investors. As a result, Moody’s expects their credit profiles will fall behind those of private sector banks.

Source: VietNamNet News July 30, 2018 07:52 UTC