Fitch upgrades HB’s individual rating

Fitch Ratings has today upgraded Hellenic Bank's (HB) Individual rating to 'C/D' from 'D,' which reflects the bank's improving profitability and asset quality, the good local franchise and adequate capitalisation. It also takes into consideration the bank's weak profitability and fragile asset quality of HB's Greek operations, expansion abroad and fast growth of its loan book.

In its report, Fitch affirmed HB's Long-term Issuer Default rating (IDR) at 'BBB', Short-term IDR at 'F3', Support rating at '2' and Support Rating Floor at 'BBB'. The Outlook for the Long-term IDR is Stable. “The bank's Long-term IDR is at its Support Rating Floor, reflecting the high probability that support from the Cypriot financial authorities would be forthcoming, if required”, the report said.

Upward potential

According to Fitch, “upward potential for HB's Individual rating, and ultimately also for the IDR could arise from further enhancements in asset quality and risk management systems, as well as profitability, especially in its Greek operations, a successful set-up of the Russian operation, and stronger group capital ratios. Developments to the contrary could create pressure on HB's current Individual rating”.