Fitch puts Westpac up a notch ERIC JOHNSTON April 2, 2010
RATINGS agency Fitch has upgraded Westpac's long-term credit rating to AA from AA-, given the improving outlook for the Australian banking sector as bad debts fall.
The agency, one of three that monitor Westpac's credit ratings, said the removal of the government's wholesale funding guarantee should have no material impact on Westpac, even though the bank is one of the most reliant on overseas funds for lending.
''The upgrade of Westpac's long-term issuer default rating and individual rating reflect the group's strong performance through the global financial crisis, an improvement in the operating environment and the successful integration of St.George Bank,'' said Fitch's director of financial institutions group, Tim Roche.
''Westpac now holds a much stronger position in the Australian retail banking market, with a significant market share in both residential mortgages and household deposits,'' Mr Roche said. The outlook for Westpac's new Fitch rating was stable.
Moody's Investors Service, has an Aa1 rating on Westpac with a negative outlook.
Standard & Poor's has a AA rating with a stable outlook.
Fitch said Westpac's performance through the downturn had been strong. ''Like other Australian banks, the group's impairment charges increased significantly during 2009 following a deterioration in asset quality. But pre-impairment operating profit has been more than sufficient to comfortably absorb these costs,'' Fitch said.
? ANZ will pay $50.8 million to move to full ownership of its banking ventures in Indonesia and Laos, to help increase its exposure to the region.
ANZ is in advanced talks with Indonesia's PT Panin Bank to acquire another 14 per cent in their jointly owned ANZ Panin Bank for $US44 million ($48 million). This would give ANZ a 99 per cent stake. Panin would retain 1 per cent.
In Laos, ANZ has agreed to acquire the remaining 10 per cent of ANZ Vientiane Commercial Bank that it did not already own, for $US2.5 million from International Finance Corporation. ANZV will be a wholly owned subsidiary of ANZ.
