Fitch upgrades Thanachart Bank and affirms Thanachart Capital
Fitch Ratings (Thailand) has upgraded Thanachart Bank’s (TBANK) National Long-term rating to ‘A(tha)’ from ‘A-(tha)’ (A minus (tha)), Short-term rating to ‘F1(tha)’ from ‘F2(tha)’, as well as upgraded the Individual rating to ‘C/D’ from ‘D’ and Support rating to ‘4′ from ‘5′.
The agency has also affirmed Thanachart Capital’s (TCAP) National Long-term rating at ‘A-(tha)’ (A minus (tha)), Short-term rating ‘F2(tha)’ and the Support ‘5′ rating. TBANK and TCAP are removed from Rating Watch Evolving. The Outlook on bothentities is Stable.
The rating actions follow the completion of a 25% acquisition of TCAP group’s main banking subsidiary, TBANK, by Canada’s Bank of Nova Scotia (Scotia, rated ‘AA-’ (AA minus)/’F1+’ on an international scale),including its intention to increase its stake to up to 49%, subject to regulatory approvals. Future rating actions will be subject to further assessment of the level of operational and financial support from Scotia, as well as the impact of the acquisition on TBANK’s banking franchise, earnings, overall business strategy and risk management, and the extent to which this addresses Fitch’s concerns on the group’s risk profile, profitability and asset quality. TBANK should benefit from Scotia’s expertise in global transaction services, commercial and retail banking and wealth management, including technology and operations. — www.theasianbanker.com (September 26 2007)–