Ratings ruling dents ambitions for VIFC

Vietnam wants to become a global financial gateway, but credit rating requirements are keeping many international banks away, raising concerns the market could lack the depth and diversity needed to truly function internationally.

- By Vy Vy

The VIFC establishing process moved into full swing late last year

(Photo: Le Toan)

Nearly five months after its official launch, the Vietnam International Financial Centre (VIFC) has attracted interest from global financial institutions including JPMorgan, Bank of America, Bank of China and Mitsubishi UFJ Financial Group. Yet to date, no foreign institution has been able to formally participate.

Explaining the situation at an event organised by the Ho Chi Minh City Business Association on May 16, Assoc. Prof. Nguyen Huu Huan, vice chairman of the executive board of the VIFC in Ho Chi Minh City, said the core obstacle lies in legal barriers under Decree No.329/2025/ND-CP.

The decree requires institutions seeking to establish wholly foreign-owned banks or branches within the VIFC to maintain a minimum credit rating of AA- from Standard & Poor’s or Fitch Ratings, or Aa3 from Moody’s, alongside a stable outlook.

“This is an excessively high threshold by global standards. Even in the US, most major banks would not meet this requirement,” stated Huan, adding that the absence of global financial institutions is undermining the attractiveness and international competitiveness of the new IFC.

He revealed that more than 10 banks are seeking to participate in the Ho Chi Minh City-based IFC but remain blocked by the regulation.