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

The ratings took into consideration VPBank'srelatively advanced governance standards and progressive management planto modernise credit risk management and operational controls.

The baseline credit assessment (BCA) also reflected the bank's need forexternal capital, exposure to other Vietnamese banks and aggressiveturnaround plan, which involves inherent execution and asset qualityrisks.

Based on reported loans alone, VPBank'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 foronly three percent of its overall loan book. Its retail bankingstrategy targets residents of Ho Chi Minh City and Hanoi withmonthly incomes between 225 - 749 USD.

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

Nguyen Duc Vinh, the bank's general director, said the bank has focusedon the retail banking segment and SMEs over the past three years withsupport 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 tobecome one of the three biggest commercial banks in the country.-VNA