26th Nov 2020 09:16
(Alliance News) - Moody's Investors Service on Tuesday upgraded the long-term deposit and senior unsecured debt ratings of NatWest Markets PLC to A3 from Baa2, and maintained the positive outlook on these ratings.
The rating agency also upgraded the subordinated and junior subordinated ratings to Ba1 and Ba2(hyb) from Ba2 and Ba3(hyb), respectively.
NatWest Markets PLC is the investment banking subsidiary of FTSE 100-listed NatWest Group PLC.
The rating action reflects Moody's view that, in light of the recently announced accelerated de-risking, restructuring and re-focusing of the business, NatWest Markets' business model will be more aligned with the corporate franchise of the ring-fenced banks of NatWest Group.
On the other hand, Moody's said it believes the probability of government support for the bank's counterparty obligations, contractual commitments and operating obligations to have declined as the bank has shrunk.
The outlook, meanwhile, reflects Moody's expectations that the bank's financial fundamentals will improve within the next three years, and the progress of the bank's ambitious restructuring plan will enable NatWest Markets to generate more stable and sustainable, albeit modest, profits.
The outlook also reflects the potentially higher capacity of NatWest Group to support NatWest Markets, Moody's highlighted.
NatWest Group shares were trading 3.0% lower in London on Thursday at 158.50 pence each.
By Evelina Grecenko; [email protected]
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