Moody's officially "set foot" in Vietnam's credit rating market

On November 24, a workshop was held to update changes in the Vietnamese corporate bond market and corporate credit rating activities. At the same time, Vietnam Investment Credit Rating Joint Stock Company (VIS Rating) officially opened its operations. By holding 49% of shares in Vietnam Investment Credit Rating Joint Stock Company (VIS Rating), Moody's Singapore officially entered the Vietnamese financial market.

Opening ceremony of Vietnam Investment Credit Rating Joint Stock Company (VIS Rating).

Vietnam Investment Credit Rating Joint Stock Company (VIS Rating) has officially opened in Hanoi. Moody's Singapore is the largest shareholder, holding 49% of shares. In addition, ACB Securities Company, Dragon Capital Fund, Nam A Bank Debt Management and Asset Exploitation Company, VNDIRECT Securities Company, VPS Securities Joint Stock Company, each hold 10.2% of shares.

Previously, VIS Rating was established in November 2021 and on September 18, 2023, the company was licensed by the Ministry of Finance to provide credit rating services and became the third organization in the Vietnamese market.

VIS Rating's largest shareholder is Moody's with 49% ownership, the rest are other shareholders such as ABCS Securities Company, NamABank, Vndirect, Dragon Capital, VPS Securities.

Mr. Pham Phu Khoi, Chairman of the Board of Directors of VIS Rating: Chairman of VIS Rating commits to providing honest information and assessments of issuers, debt instruments or corporate bonds, helping investors have more basis to make accurate decisions, helping businesses have a reliable capital calling channel.

The establishment of VIS Rating is an important step to promote the development of Vietnam's financial market, especially in the context of the bond market going through difficult times and needing the cooperation and contribution of investors, issuers, consultants... to build trust and continue to develop strongly in the coming time.

"We all know that the bond market is experiencing great challenges and difficulties, lack of stability in the market structure, lack of trust from investors and businesses. The birth of VIS Rating is not only an important step in the development of the financial market, but also an important event to quickly rebuild trust, transparency and standards for the Vietnamese bond market," Mr. Pham Phu Khoi emphasized.

According to Moody’s, the value of Vietnam’s outstanding corporate bonds will reach about 13% of GDP by the end of August 2023. This shows the strong growth potential of the debt market. In this momentum, credit ratings and research will play an important role by helping companies access new capital, develop financing strategies, demonstrate transparency and maintain investor confidence during times of market stress.

At the event, Ms. Wendy Chong, Moody's Director for Asia-Pacific, shared the moment marking VIS Rating's entry into the domestic partner network and affirmed Moody's long-term mission of providing expertise and trusted standards to help investors make decisions with confidence.

“With a 49% stake in VIS Rating, the partnership between VIS Rating and Moody’s is an important step in shaping the future of the financial industry. By combining Moody’s international expertise and local expertise, VIS Rating will provide the best independent credit rating services to domestic issuers and businesses, becoming the rating agency of choice in Vietnam,” said Wendy.

Moody's is committed to providing best practice services, technical support and expertise, helping to enhance VIS Rating's capacity and become the enterprise of choice for all parties in Vietnam. Looking at the broader picture, the best way to serve investors, bond issuers and the market in general is to be present and work directly with all parties.

Representatives of credit rating companies discuss at the Workshop

Credit results are reference information to help the financial market develop healthily.

From the perspective of a management agency, Mr. Nguyen Hoang Duong, Deputy Director of the Department of Finance for Banks and Financial Institutions (Ministry of Finance) affirmed: Credit rating activities are an important component of the financial market in general and the bond market in particular.

Through credit rating results, investors have more information about the level of risk in the financial market and bonds in the investment market. Credit rating results are not advice for investors to buy or sell any financial products, but this is important reference information, which is of interest to market participants when making investment decisions.

Along with independent auditing activities, credit rating activities are effective tools to help the capital market develop sustainably, unlocking important capital sources for the economy. In order for VIS Rating to be certified as qualified to do business under Vietnamese law, the Ministry of Finance, after carefully assessing the documents, asked many necessary and appropriate interview questions.

According to experts, the Government has recently paid special attention to upgrading the stock market. One of the limitations of Vietnam in recent times is that credit rating activities in Vietnam have not yet developed. Therefore, there is a need for solutions to improve the quality and transparency of information disclosure by listed companies, such as developing the credit rating market.

Appreciating Moody's participation in the credit rating market of Vietnam as a shareholder contributing capital to establish VIS. On that basis, Mr. Duong requested VIS Rating to fully implement processes, policies, procedures, and internal control systems to prevent risks and avoid conflicts of interest in the process of providing services in the market. In particular, it is necessary to fully comply with the provisions of law in the process of providing credit rating services in Vietnam.