June 15, 2005 — A high level seminar held on June 15 in Hanoi with 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", were the Vietnam Association of Financial Investors (VAFI), and the International Finance Corporation’s Mekong Private Sector Development Facility (IFC-MPDF). The seminar attracted representatives from local and international commercial banks, insurance companies, investment funds, large corporations and related 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.
For further information, please contact Nguyen Hanh Nam, nmy@ifc.org
