Moody's keeps Security Bank’s ratings, stable outlook
MANILA, Philippines — Moody's Investors Service has affirmed all the ratings and assessments of Security Bank Corp. on the back of its above industry average asset quality and strong capital buffers. The rating outlook is maintained at stable.
In a statement, the international debt watcher said Security Bank’s “Baa2” deposit ratings incorporate a one-notch uplift from the lender's “baa3” Baseline Credit Assessment to reflect Moody's expectation that the bank will receive support from the Philippine government in times of need.
Deposit ratings are Moody’s opinions of a bank’s ability to punctually repay its foreign and domestic currency deposit obligation. Obligations rated “Baa” are subject to moderate credit risk.
Meanwhile, Baseline Credit Assessments express the likelihood of an issuer defaulting on one or more of its debt obligations, or requiring financial or other support to avoid such a default, and does not provide an opinion on the severity of any loss.
In its assessment, Moody’s said Security Bank’s new strategic partnership with Tokyo-based MUFG Bank, Ltd. is expected to moderate Security Bank’s asset quality and capital profile over time because of its “higher-than-industry growth plans.”
“The bank's overall liquidity remains comfortable, with sufficient liquid resources to meet near-term obligations,” the debt watcher said.
“Moody's assumes a moderate likelihood of government support for Security Bank's depositors and senior unsecured creditors, driven by the bank's significance to the Philippine banking system,” it added. — Ian Nicolas Cigaral
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