(Repeat for additional subscribers)
Jan 9 (Reuters) - (The following statement was released by the rating agency)
Fitch Ratings has downgraded Arab Bank Australia Limited’s (ABAL) Long-Term Issuer Default Rating (IDR) to ‘BBB-’ from ‘A-'. The Rating Watch Negative (RWN) has been removed. The Outlook is Negative. ABAL’s Viability Rating remains unaffected at ‘bb+'. A full list of rating actions can be found at the end of this rating action commentary.
KEY RATING DRIVERS - IDRs AND SUPPORT RATING
ABAL’s IDRs and Support Rating have been downgraded following the rating action on its parent, Arab Bank plc (Arab Bank, BBB-/Negative) on 9 January 2014. Please refer to ‘Fitch Downgrades Arab Bank PLC to BBB-; Negative Outlook’ published 9 January 2014.
ABAL’s Long- and Short-Term IDRs and Support Rating reflect its status as a core subsidiary of its parent. Both share the same brand name and strategy, and maintain a close working relationship. The group keeps a very liquid balance sheet, and is well placed to provide support, especially given ABAL’s small size relative to its parent. ABAL made up just 2.5% of the group’s total assets at end-2012.
RATING SENSITIVITIES - IDRs & SUPPORT RATING
ABAL’s IDRs and Support Rating would be downgraded if Arab Bank’s IDRs were downgraded, or if there were a change in Fitch’s view of ABAL’s role as a core subsidiary of Arab Bank.
The rating actions are as follows:
Arab Bank Australia Limited (ABAL):
Long-Term IDR downgraded to ‘BBB-’ from ‘A-'; removed from RWN; Outlook
Short-Term IDR downgraded to ‘F3’ from ‘F1’; removed from RWN;
Support Rating downgraded to ‘2’ from ‘1’; removed from RWN; and Viability Rating; ‘bb+', unaffected.