HANOI, May 7 (Reuters) - Credit ratings agency Fitch said on Tuesday it saw no contagion risks from the recent publication of new information about a massive fraud engulfing Saigon Joint Stock Commercial Bank (SCB), one of the largest private lenders before its crisis.
Last month, the central bank said it was continuing to support SCB under a roadmap for its restructuring - a move that Fitch considered a positive sign of the central bank's commitment to help significant lenders.
The disclosure by the State Bank of Vietnam came days after Reuters reported it had pumped nearly $24 billion into SCB to avert its collapse since a run on deposits in October 2022, and continued special loans to the bank at least until early April.
"We believe the release of further details regarding SCB in recent weeks has not created new contagion risks," Fitch said in a statement, referring to the report on the unprecedented bank rescue.
"We see no evidence of distress – such as sudden share price movements, deposit flight or regulatory response – in other systemically important Vietnamese banks."
Reuters had reported that SCB, one of the largest banks by deposits before the central bank put it under special supervision, had lost 80% of its deposits between October 2022 and December 2023, leaving it with $6 billion by then.
"Fitch believes SBV's actions demonstrate its high propensity to provide support to systemically significant institutions, even when a bank's stress results from its own governance failures," the agency said.
The landmark corruption case showed up shortcomings in Vietnam's financial supervision, it added.
SBV did not immediately respond to a request for comment.
The agency said the central bank's support for SCB via special loans could be partly repaid if SCB recovered some of the assets from Truong My Lan, the businesswoman sentenced to death for embezzling from SCB.
The estimated value of those assets ranges from $12 billion to $30 billion.
Fitch added that the costs of the rescue operation did not represent "an explicit sovereign liability" but cautioned "moves by the government to strengthen SBV's capital position would have an impact on public finances." (Reporting by Francesco Guarascio @fraguarascio; Editing by Clarence Fernandez)
