Credit Rating Result
Hanoi, 12 June 2025 - Vietnam Investors Service and Credit Rating Agency Joint Stock Company (VIS Rating) has assigned BBB+ subordinated debt ratings to three tranches of subordinated bonds issued by Vietnam Asia Commercial Joint Stock Bank (VAB). VAB issued three tranches of private placement subordinated bonds , totalling VND 1 trillion in 2023-2024.
The outlook of the ratings is stable. This is the first time VIS Rating assigned ratings to VAB’s subordinated bonds.
The rating is based on the final terms and conditions in the bond transaction documents reviewed by VIS Rating.
Rating rationale
The BBB+ rating assigned to the subordinated bonds issued by VAB is positioned one-notch below the bank’s issuer rating.
This reflects our view that the bank’s subordinated bonds are subject to legal subordination and higher loss severity compared to the bank's senior obligations.
The subordinated bonds constitute direct, unsecured and subordinated obligations of VAB, and rank pari passu with other subordinated liabilities of the bank.
According to SBV’s Circular 41 , bank subordinated bondholders rank junior to all bank senior creditors in terms of the creditor claim priority during liquidation.
In addition, the bonds have an optional, cumulative coupon-skip mechanism related to a net loss trigger. Coupon payments can be deferred at the option of VAB if such payments will result in a net loss for the bank in the financial year when the coupon payments are due.
As required by Decree 65 , each private placement bondholder must sign a legally binding agreement with the issuing bank to acknowledge their understanding of the bond investment risks and bear responsibility for their investment decision.
The securities will mature in seven years and can be called by the issuer after two years.
According to the bond prospectus, the proceeds from the bond issuance will be used to increase the bank’s Tier 2 capital and supplement its medium- to long-term funding sources for lending to targeted sectors, including energy, power generation, manufacturing, and construction.
According to VAB, it has complied with all disclosure requirements and fulfilled all other obligations in accordance with the bond terms and conditions and all relevant laws. VAB has made all principal and interest payments for the three subordinated bonds in full and on a timely basis over the past three years. These bonds are registered with the Vietnam Securities Depository (VSD) and listed on the Hanoi Stock Exchange (HNX).
The bank has appointed National Securities Company (NSI) to serve as the advisory service provider and bondholder representative for the subordinated bonds. NSI is required to monitor VAB’s compliance with requirements under relevant laws, and notify bondholders of any event of default.
Established in 2003, VAB is a small-sized, privately-owned commercial bank with a 0.7% share of total deposits at end-2024.
Factors That Could Lead to an Upgrade/Downgrade
Rating methodology
Financial Institutions Rating Methodology.
For more detailed information, please refer to our full credit rating methodology at: here
Credit rating history
| Date | Rating type | Rating | Bond code | Maturity | Outlook | Action |
|---|---|---|---|---|---|---|
| 12 June 2026 | Subordinated debt rating | BBB+ | VABCLH2330001 | 7 years | Stable | First-time assignment |
| 12 June 2026 | Subordinated debt rating | BBB+ | VABCLH2431001 | 7 years | Stable | First-time assignment |
| 12 June 2026 | Subordinated debt rating | BBB+ | VABLH2431002 | 7 years | Stable | First-time assignment |
Regulatory disclosures
For further specification of VIS Rating's Rating Symbols and Definitions, please see: here
VAB’s ownership stake in VIS Rating: 0%
The ownership ratio of VAB held by VIS Rating’s staff: 0%
Cases in which analysts and credit rating council members cease their participation in the credit rating contract before the contract expires and the reason for the cessation: 0
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The rating has been disclosed to the rated entity or its designated agent(s) and issued with no amendment resulting from that disclosure.
This rating is solicited.
Regulatory disclosures contained in this rating announcement apply to the credit rating and, if applicable, the related rating outlook or rating review.
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Analyst & Committee
Primary Analysts
Rating Committee Members
Credit Rating Announcement Number
Public credit rating announcement no: VN0302963695-002-120625
Disclaimer
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