S&P Global Ratings has downgraded Vietnam Export Import Commercial Joint Stock Bank's long-term issuer credit rating to B+ from BB-, according to a recent release.
The rating action follows the bank's restructuring announcement and leadership changes that led to the resignation of most board members.
The bank's capital buffers declined after a 66% drop in profits last year, given one-off expenses and heightened provisioning costs, S&P said.
The rating agency believes a rise in market share will take time, with strategic changes taking two to three years to bear fruit and vulnerability due to constant leadership turnover serving as a constraint.
The country's banking system continues to have volatile operating conditions amid rising credit growth and high private-sector debt amid geopolitical headwinds.
The outlook is stable, given S&P's view that the bank will appoint a new leadership team and fill its board at the upcoming annual general meeting to carry out its growth strategy.
The rating agency also forecasts profits to stabilize in 2026.
Material changes in the bank's corporate governance, financial position or capital levels could lead to future rating actions.