Standard & Poor’s reaffirms rating of KAS BANK

Rating agency Standard & Poor's (S&P) has reaffirmed the short-term rating A-2 and the long-term rating BBB + of the bank. The outlook remains ‘negative’.

The S&P rating is based on three main considerations that result in maintaining the rating at the current level. S&P observed a normalisation of the profitability of KAS BANK and a consolidation of the franchise. The strategic repositioning programme the bank started in 2014 is expected to have a positive impact on profitability, according to S&P. The rating agency expects that KAS BANK will deliver an increase in operating profit, given that the bank operates in a stable market environment. KAS BANK has a low credit risk.

The introduction of the Bank Recovery and Resolution Directive (BRRD) in Europe leads to uncertainty about extraordinary government support and will also have an impact on systemically important European banks such as KAS BANK in the Netherlands. However, this effect is offset by the positive effect of the strategic repositioning of KAS BANK.

The outlook 'negative' may be adjusted to 'stable' over time as the strategic repositioning of the bank delivers the expected benefits. S&P states that new regulations governing the European securities industry, such as EMIR and AIFMD, as well as new reporting requirements for Dutch pension funds, provides KAS BANK with opportunities for further growth in its home markets of the Netherlands, UK and Germany.

For more information on the rating please refer to the S&P Rating Direct Research Update (PDF opens in new window).