Fitch Ratings (
Fitch has also affirmed the National Short-Term Rating at 'F1+(tha)' and senior debt rating at '
The Outlook revision follows
Key Rating Drivers
CLT's ratings are driven by shareholder support from
CLT will become a subsidiary of UOBT with full ownership and control by the parent once the transaction completes. We expect CLT to have an important role in supporting UOBT's retail banking business, based on the leasing company's profitable personal loan business. We believe the UOB group will have the ability and propensity to provide extraordinary funding support to CLT through UOBT after the acquisition, if needed. CLT's asset size of only 3% compared with UOBT's assets prior to the acquisition should not be material for UOBT if support were required.
We expect support prospects from
CLT's National Long-Term Rating also reflects our belief that, after considering support prospects, the company's credit profile is in line with the best credits in the country.
CLT's senior debt ratings are at the same level as its National Long-Term Rating, reflecting the unsubordinated and unsecured nature of the obligations.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive rating action/upgrade:
There is no upside to CLT's rating, as it is at the highest level on the national ratings scale.
Factors that could, individually or collectively, lead to negative rating action/downgrade:
Prior to the completion of the deal, a reduction in
Any substantial changes to the acquisition plan by UOB group may lead to a re-assessment of support prospects and potentially lead to ratings downside. However, this is not our base case scenario.
Best/Worst Case Rating Scenario
International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from '
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
Public Ratings with Credit Linkage to other ratings
CLT's ratings are linked to the Viability Rating of
RATING ACTIONS
Entity / Debt
Rating
Prior
Natl LT
Affirmed
Natl ST
F1+(tha)
Affirmed
F1+(tha)
senior unsecured
Natl LT
Affirmed
Page
of 1
VIEW ADDITIONAL RATING DETAILS
Additional information is available on www.fitchratings.com
(C) 2022 Electronic News Publishing, source