Fitch: Challenging environment for Vietnamese banks
Fitch Ratings has said that in the immediate future, Vietnam’s banks face a particularly challenging environment, due to sharply higher interest rates and much tighter liquidity, as belatedly imposed by the country’s central bank, State Bank of Vietnam, recently to combat the sharp increase in inflation.
The special report, “Vietnamese Banks - A Home-Made Liquidity Squeeze?”, is to published by the agency today.
“The higher interest rate environment is likely to result in borrower stress and higher credit costs,” says Sabine Bauer, Director in Fitch’s Financial Institutions team. “In this regard, the private banks are most exposed given their rapid loan growth over recent years - especially if it has been imprudently - to property developers and stock market investors.”
–www.theasianbanker.com (May 30 2008)–