Moody's lowers UniCredit Bank Slovakia long-term deposit rating to Baa1.

By bne IntelliNews October 10, 2011
Moody's Investors Service has downgraded the long-term deposit rating of UniCredit Bank Slovakia (UBS) to Baa1 from A3, with a stable outlook, the ratings agency said on its website. The short-term deposit rating at Prime-2 and the standalone bank financial strength rating (BFSR) of D+ (mapping to Ba1 on the long-term scale) were unaffected. The move followed Moodys recent downgrade of UniCredit's long-term debt and deposit ratings to A2, with a negative outlook, and its standalone BFSR to C- (mapping to Baa1, with negative outlook, on the long-term scale). The lowered ratings on UBS's parent lower also the extent to which Moodys is factoring in the probability of parental support into UBS's deposit ratings. An improvement in the bank's standalone BFSR could put upward pressure on the bank's deposit ratings, but Moodys sees such an opportunity as very limited. An upgrade of UniCredit could also lead to an upgrade of UBSs deposit ratings, but such a possibility is also highly unlikely given the negative outlook on UniCredits ratings. On the other hand, UBSs ratings could move further down in case the banks financial strength deteriorates and in case of a downgrade of UniCredit and/or of Slovakia. UBS total assets stood at EUR 3.7bn at the end of June 2011.

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