Fitch Affirms Rating on ING Bank's Baht Bonds at 'AAA(tha)'

Mon Aug 4, 2014 1:20am EDT

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(The following statement was released by the rating agency) BANGKOK, August 04 (Fitch) Fitch Ratings (Thailand) has affirmed ING Bank N.V.'s (ING Bank) THB4.26bn senior unsecured bonds due 2016 at 'AAA(tha)'. This follows the recent affirmation of ING Bank's ratings on 24 July 2014 (see "Fitch Affirms ING Bank at 'A+'; ING Group at 'A'; Outlooks Negative" at www.fitchratings.com) KEY RATING DRIVERS The rating of the bonds is based on ING Bank's Long-Term Foreign Currency Issuer Default Rating (IDR) of 'A+', which is higher than Thailand's Long-Term Local Currency IDR of 'A-' and hence correlated to 'AAA(tha)', the highest rating on Thailand's National rating scale. ING Bank's IDR and senior debt ratings are at the bank's 'A+' Support Rating Floor (SRF), reflecting Fitch's expectation that there remains an extremely high probability that the Dutch state (AAA/Stable) will support the bank, if required, given its systemic importance to the domestic economy and financial system. The Negative Outlook on ING Bank's 'A+' Long-Term IDR reflects Fitch's expectation that sovereign support for banks is likely to decline in the European Union (EU). See "Sovereign Support for Banks - Rating Path Expectations", dated 27 March 2014, available at www.fitchratings.com. RATING SENSITIVITIES The 'AAA(tha)' rating on ING Bank's bonds is the highest on the national scale and, hence, no rating upside is possible. A downgrade of the Thai baht-denominated bond's rating is unlikely in the short to medium term. When regulatory initiatives that reduce state support for banks substantially are put in place, Fitch's base case for most EU banks (including ING Bank) is that their SRFs will be revised down to 'No Floor' in 2H14 or in 1H15, at which point these banks' Long-Term IDRs will be driven by their Viability Ratings (VR), which reflect their standalone creditworthiness. ING Bank's Long-Term IDR is thus likely to be downgraded in 2H14 or in 1H15 but the bank's 'a' VR would limit the downgrade of the Long-Term IDR to one notch. This means that ING Bank's Long-Term Foreign Currency IDR is likely to fall to 'A', which is still above than Thailand's Long-Term Local Currency IDR of 'A-'. ING Bank is the largest Dutch bank by total assets and it has a strong retail and commercial banking franchise in the Benelux region. ING Bank's other ratings are not affected and are as follows: Long-Term IDR: 'A+'; Outlook Negative Short-term IDR: 'F1+' Viability Rating: 'a' Support Rating: '1' Support Rating Floor: 'A+'; Subordinated debt: 'A-' Senior unsecured notes: 'A+/F1+' Short-term senior unsecured notes: 'F1+' Commercial paper: 'A+/F1+' Contacts: Primary Analyst (ING Bank's THB bonds) Patchara Sarayudh Director +662 108 0152 Fitch Ratings (Thailand) Limited Park Ventures, Level 17 57 Wireless Road, Lumpini Patumwan, Bangkok 10330 Secondary Analyst (ING Bank's THB bonds) Parson Singha, CFA Senior Director +662 108 0151 Committee Chairperson (ING Bank's THB bonds) Mark Young Managing Director +65 6796 7229 Primary Analyst Philippe Lamaud (ING Bank, ING Belgium, ING Group) Director +33 144 29 91 26 Fitch France S.A.S. 60, rue de Monceau 75008 Paris Secondary Analysts Jens Hallen (ING Bank, ING Belgium) Senior Director +44 203 530 1326 Marc-Philippe Juilliard (ING Group) Senior Director +33 144 29 91 37 Media Relations: Elaine Bailey, London, Tel: +44 203 530 1153, Email: elaine.bailey@fitchratings.com; Leslie Tan, Singapore, Tel: +65 67 96 7234, Email: leslie.tan@fitchratings.com. Note to Editors: Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. The best risk within a country is rated 'AAA' and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(tha)' for National ratings in Thailand. Specific letter grades are not therefore internationally comparable. Additional information is available at www.fitchratings.com. Applicable criteria, "Global Financial Institution Rating Criteria", dated 31 January 2014 and "National Scale Ratings Criteria", dated 30 October 2013, are available at www.fitchratings.com. Applicable Criteria and Related Research: Global Financial Institutions Rating Criteria here National Scale Ratings Criteria here Additional Disclosure Solicitation Status here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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