S&P Global Ratings has placed its 'A' long-term and 'A-1' short-term issuer and issue credit ratings on AMP Bank on CreditWatch with negative implications. The ratings agency also placed its 'A-' subordinated issue credit rating on the bank on CreditWatch with negative implications.
AMP Bank's CreditWatch placement follows a similar action on AMP and its insurance subsidiaries, as well as AMP Group Holdings (AGHL) – an intermediate holding company of the broader AMP Group that provides a guarantee covering senior unsecured obligations of AMP Bank.
“When assessing group support for the bank, we take the higher of explicit or implicit support,” the ratings agency said. “The explicit support from AGHL is currently one notch higher than the theoretical rating derived from our expectations of implicit support – a function of the bank's stand-alone credit profile (SACP) of 'bbb-' and three notches of uplift above its SACP due to its strategic importance to the broader group (collectively resulting in a rating outcome of 'A-'). Therefore, we currently equalize our long-term and short-term issuer credit ratings, and senior unsecured issue ratings, on the bank with those on AGHL.”
S&P said the bank's subordinated issue credit rating was also placed on CreditWatch with negative implications despite not being covered by AGHL's guarantee “as we notch these off the issuer credit rating on the bank.”
The ratings agency said it will resolve the CreditWatch status on AMP Bank after a similar resolution on the broader AMP Group, which is expected in around three months.
