It also reflects VFL's increased scale of operations, which Fitch believes would help strengthen the company's balance sheet over the medium-term.
The stable outlook reflects Fitch's view that VFL would be able to maintain its financial profile over the medium-term, supported by ongoing improvements to its systems and processes and the improving economic environment.
VFL's asset quality, which had weakened in 2008-2009, showed continuous improvements from end-2009, aided by an improving macro-economy and increased recovery efforts, the rating agency said.
Its gross NPLs (arrears in excess of three months), which had reached their peak in end-September 2009, fell by 34 percent by end-September 2010.
This, together with aggressive loan growth, enabled the company to post a gross NPL ratio of 7.0 percent at end-Septem