The strong economic rebound in New Zealand (credited to the handling of the pandemic) has seen Fitch revise the ratings of two locally-owned banks.
Fitch Ratings has revised the Outlook on New Zealand-based The Co-operative Bank’s Long-Term Issuer Default Ratings (IDRs) to Positive from Negative, and affirmed the Long-Term IDRs at 'BBB'.
“The Outlook revision reflects the strong economic rebound in New Zealand, which has reduced the risks to Co-op's operating environment, asset quality, and earnings and profitability,” Fitch said. “The strong recovery in earnings exceeded our base-case expectations for the bank.”
Likewise, the Outlook on TSB Bank’s Long-Term Foreign- and Local -Currency Issuer Default Ratings (IDRs) has been revised by Fitch to Stable, from Negative, and it has affirmed the Long-Term IDRs at 'A-'.
Fitch said its outlook for New Zealand's bank operating environment had “improved significantly since mid-2020”, crediting the handling of the health aspects of the Covid-19 pandemic for the economic rebound.