Hanoi, 15 June 2005 — In a high level seminar held today in Hanoi, 300 representatives from government and the business community in Vietnam, considered the feasibility of establishing a credit rating agency (CRA). For a fee, such an agency would review and provide ratings for companies that are seeking investors. Joint organizers of the seminar, Solutions towards establishment of a Credit Rating Agency in Vietnam, are the Vietnam Association of Financial Investors (VAFI), and the International Finance Corporation’s Mekong Private Sector Development Facility (IFC/MPDF).
VAFI is promoting the establishment of a credit rating agency in Vietnam in order to contribute to development of the capital market, and especially a bond market, and through that the growth of Vietnam’s economy.
The seminar attracted representatives from local and international commercial banks, insurance companies, investment funds, large corporations and related government agencies. Distinguished guests such as Vietnam’s Vice Minister of Finance, Nguyen Van Ta, and Deputy Director of the Hochiminh Stock Exchange, Le Dac Sinh, talked about the role a CRA could play in contributing to growth of a capital market in Vietnam and overall economic growth. In his presentation, Mr. Nguyen Hoang Hai, General Secretary of VAFI, discussed the proposed corporate model for Vietnam’s CRA and made recommendations to government agencies.
International experts from the Nomura Research Institute of Japan (NRI) and the Rating Agency of Malaysia (RAM), presented legal and regulatory frameworks and operating models of CRAs in other countries and specific recommendations for Vietnam.
IFC-MPDF presented lessons IFC has learned from investing in Credit Rating Agencies in emerging markets worldwide. According to Jacco Minnaar, IFC-MPDF's acting Finance Sector Program Manager, "A credit rating agency can play an important role in supporting information dissemination, particularly for the bond market. IFCs experience worldwide has shown that while credit rating agencies are important, they are only part of what’s required for a successful corporate bond market. Today’s seminar is important because it brings together all the stakeholders to discuss the key issues that must be addressed before a credit rating agency can be established and operate successfully in Vietnam".
