S&P lifts credit ratings for most non-major Australian banks
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The news: S&P Global Ratings has raised its long-term issuer credit ratings on most of the non-major Australian-based banks, following its review of the Australian banking sector which concluded that industry-wide risks have reduced.
The context: S&P noted the reduction in risks was due to the continued strengthening of regulatory and governance standards in the Australian banking sector, along with improvements driven by simplified business models and advances in risk management.
S&P said it now assesses the institutional framework for Australia's banking industry at the lowest risk level on its scale, and in line with that in Canada, Hong Kong and Singapore. Consequently, S&P raised its long-term issuer credit ratings on most of the non-major Australian-based banks, and other financial institutions.
Issuer credit ratings remained unchanged on some financial institutions, including the four major Australian banks, Macquarie Bank and two foreign-owned banks.
S&P's ratings on Suncorp-Metway were placed on CreditWatch with positive implications, as there was an increasing probability that its acquisition by the higher rated ANZ would be completed within the next six months.
Outlooks on all the remaining Australian banks, almost all other Australian financial institutions, and their New Zealand subsidiaries were considered stable.
The upgraded non-major banks listed on the ASX were AMP, Bank of Queensland, Bendigo and Adelaide Bank, Judo Bank and Liberty Financial.
The source: S&P Global media release
