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May 16 (The following statement was released by the rating agency)
Fitch Ratings has placed Turkey's Tekstil Bankasi A.S. (Tekstilbank)'s Long- and Short-term foreign and local currency Issuer Default Ratings (IDRs), National Long-term and Support Ratings on Rating Watch Positive (RWP). A full list of rating actions is available at the end of this rating action commentary.
The RWP follows Industrial and Commercial Bank of China's (ICBC; A/Stable) purchase of 75.5% of Tekstilbank's equity from the bank's current owner GSD Holding. The acquisition is pending regulatory and GSD Holding shareholders' approval.
KEY RATING DRIVERS - IDRS, National and Support Ratings
Fitch views ICBC's ability to support Tekstilbank, if ever needed, as very high given its rating level and Tekstilbank's small balance sheet relative to ICBC's, which should limit the potential cost of support for ICBC. Fitch will assess ICBC's propensity to support Tekstilbank as more information on the acquisition is available.
RATING SENSITIVITIES - IDRS, NATIONAL RATINGS AND SENIOR DEBT
The RWP will be resolved upon completion of the transaction. If the acquisition is successful, the bank will likely see a multi-notch upgrade of its Long-term IDRs, National and Support Ratings. The bank's Long-term foreign currency IDR will most likely be upgraded to 'BBB', Turkey's Country Ceiling.
The rating actions are as follows:
Long-Term Foreign and Local Currency IDRs: 'B+'; Rating Watch Positive
Short-Term Foreign and Local Currency IDRs: 'B'; Rating Watch Positive
Viability Rating: 'b+'; unaffected
Support Rating: '5'; Rating Watch Positive
Support Rating Floor: 'No Floor'; unaffected
National Long-Term Rating: 'A(tur)'; Rating Watch Positive