There was an article from VNS a few days ago talking about an upcoming credit worthiness rating book for publicly traded companies in Vietnam (see original article).
The book is published by the Credit Information Center of Vietnam and Dun & Bradstreet (D&B) and will be available in both English and Vietnamese.
There was no mentioning in the article as to when the books will come out or how much it will cost.
I did some quick searches on D&B website and looks like these credit reports are currently available online. However, the price is US$498.99 for each report, which is pretty expensive--click here to view the search results of companies with the word "Vietnam" in the name. You can refine the search further by putting in a specific company name or keyword using the form at the bottom of the page.
The credit worthiness of the public companies is based on the audited financial reports which will be provided by the State Securities Commission. The evaluation process is done entirely by computer software. Each company will receive a rating ranging from "AAA" for the best rated companies to "C" for the worst ones--this is the typical rating scale for D&B.
The ratings can be useful in determining the credit worthiness of listed companies. However, unless you are major investor, I am not sure how many people can really afford the $US498.99 price.
Keep in mind though, the ratings are only as good as the integrity and accuracy of the data source, which is the audited financials provided by the companies. The reliability of the audited financials will depend upon factors such as the automony and competency of the auditing firm, interpretation of accounting rules, conflicts of interest, and the integrity of management.
Tuesday, December 4, 2007
Credit Rating Book for Public Companies in Vietnam
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2 comments:
Integrity? In Vietnam? Surely you jest... Spent two years doing business there. Never again. Yeah, things are changing. But at this rate it will be 100 years before anyone can think of investing. Corruption is rife. You know the annual interest rate there comes out to be around 15% on a savings account with more than $10k in it right? That's because nobody else trusts them with their money either. They need such high rates to justify the risk. Wish I could easily mortgage the equity out of my house (6%) and put it in a bank over there at 15!
You are right about the corruption. The government is trying to get rid of it but easier said than done since the corruption is so prevalent.
However, to attract more foreign investors (as well as for their own economic and social development,) I think the government will need to make it a high priority to curb this insidious problem.
Things, overall, don't get done quickly in Vietnam. This was one of the issues brought up by Commerce Secretary Carlos Gutierrez in his recent visit as well as by people who are currently doing business in Vietnam.
Thanks for your comment.
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