In the wake of this increase, the long-term deposit rating of Novo Banco has also been upgraded from A3 to A2, as well as the senior unsecured debt rating, which improved from Baa2 to Baa1, while maintaining a positive outlook,” stated a communication to the Comissão do Mercado de Valores Mobiliários (CMVM).
This upgrade has resulted in Novo Banco’s subordinated debt achieving an ‘investment grade’ rating, now classified as Baa3.
According to the bank, the enhancement in credit assessment from baa3 to baa2 reflects “a significant improvement in asset quality indicators,” “robust profitability metrics,” and “an increased loss absorption capacity supported by high capital levels,” along with “an improved funding and liquidity position.”
The continued positive outlook on the long-term deposit and senior unsecured debt ratings “reflects Moody’s assessment of the bank’s expected performance over the next 12 to 18 months.”
The Baseline Credit Assessment (BCA) is a credit evaluation used by rating agencies to determine an institution’s credit risk profile.
