Fitch Places South Africa's Imperial Bank on Rating Watch Positive
Fitch Ratings-London/Johannesburg-19 August 2009: Fitch Ratings has today placed South Africa-based Imperial Bank Limited's (Imperial) National Long-term 'A+(zaf)' and National Short-term 'F1(zaf)' ratings on Rating Watch Positive (RWP). At the same time, the Support Rating '2' has been affirmed. The National Long-term rating of 'A(zaf)' assigned to the bank's subordinated debt has also been placed on RWP.
The RWP follows Nedbank Limited's (Nedbank) announcement of 14 August 2009 that it has entered into a non-binding memorandum of understanding in terms of which it has been agreed, in principle, to acquire the remaining 49.9% stake of Imperial from Imperial Holdings Limited (IHL).
Imperial's ratings reflect the strong perceived level of support that the bank enjoys from Nedbank (rated 'BBB'/'AA-(zaf)'). On completion of this transaction, Imperial would become a wholly-owned subsidiary of Nedbank. The RWP would be resolved once the acquisition is completed.
Incorporated in November 1995, Imperial is a niche provider of asset-based finance and was initially established as a wholly-owned bank subsidiary of IHL. In January 2001, Nedbank acquired a 50.1% controlling stake in the bank, as part of a strategic agreement with IHL. Nedbank provides Imperial Bank with funding and risk management support. IHL provides the bank with access to its extensive network of business operations throughout South Africa.
Contacts: Denzil de Bie, Anthony Walker, Johannesburg, Tel: +27 11 380 0900.
Media Relations: Hannah Warrington, London, Tel: +44 (0) 207 417 6298, Email: hannah.warrington@fitchratings.com.
Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. The best risk within a country is rated 'AAA' and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(zaf)' for National ratings in South Africa. Specific letter grades are not therefore internationally comparable.
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