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Monday, November 22, 2004

Fitch upgrades BCR, BRD, UCR

Fitch Ratings, the international rating agency, has today upgraded BRD-Groupe Societe Generale's ("BRD") and UniCredit Romania's ("UCR") ratings to Long-term 'BBB-' (BBB minus) from 'BB' and to Short-term 'F3' from 'B'.

At the same time, BRD's and UCR's Support ratings have been changed to '2' from '3'. Following the upgrade, the Outlook is now Stable. The Long-term rating of Banca Comerciala Romana ("BCR") is also upgraded to 'BB+' from 'BB-' (BB minus), while the Support rating of Banc Post has been changed to '2' from '3'.
In addition, the Individual rating of UCR is affirmed at 'D', while BCR's other ratings are affirmed at Short-term 'B', Individual 'D' and Support '3' The Outlook on BCR's Long-term rating remains Stable.

These rating actions reflect yesterday's upgrade of Romania's Long-term foreign currency rating and Country Ceiling to 'BBB-' (BBB minus) from 'BB' and Short-term rating to 'F3' from 'B'. Following the upgrade, the Outlook is now Stable.

The Long-term, Short-term and Support ratings of BRD and UCR reflect the potential support from their foreign parents in case of need. BRD is 51%-owned by Societe Generale, (rated Long-term 'AA-' (AA minus)) and UCR is 99.8%-owned by Unicredito Italiano (rated Long-term 'AA-' (AA minus)).

However, due to the potential transfer risk in Romania, which could constrain the ability of these institutions to support their subsidiaries, BRD's and UCR's Long-term ratings are constrained by Romania's Country Ceiling of 'BBB-' (BBB minus).

BCR's Long-term, Short-term and Support ratings reflect the potential support from the Romanian state if required, given its systemic importance and the 38% stake held by the government. Banc Post's Support Rating reflects the potential support from its 58% shareholder, EFG Eurobank Ergasias (rated Long-term 'A-' (A minus)),

BCR is the largest bank in Romania representing c.33% of total banking assets. BRD is Romania's second largest bank, accounting for c.16% of total banking assets, and has been majority-owned by Societe Generale since 1999.

UCR was a relatively small bank when UniCredito Italiano initially took a stake in it in June 2002. The bank has since undertaken an expansion strategy targeting both corporate and retail clients. EFG Eurobank Ergasias gained a majority stake in Banc Post in November 2003. Since then a major restructuring programme has begun.

Posted by Mihai : 11/22/2004 06:09:00 pm