Fitch affirms KAS BANK's A- rating. However, the outlook has been adjusted to negative.
Fitch bases their rating by referring, among others, to the decline in profitability. Fitch notices that part of our profit was reinvested in IT improvement projects. The rating agency acknowledges KAS BANK has good control over the outsourcing of our IT activities. Fitch also refers in its report to our low risk appetite and underlines our healthy liquidity position.
14 Nov 2018
Fitch bases its rating on, among others, the following conclusions:
- Fitch identifies a decrease in clients and profitability as a result of the dynamics in the pension and insurance market. However, it also expects the bank to maintain a critical mass in its core activities.
- However, Fitch states that the bank has developed extra value added services for its clients, partly thanks to its knowledge of local reporting and regulatory requirements.
- Fitch acknowledges our low risk appetite. The credit risk is very low and arises mainly from intraday settlements, provided with collateral. Operational risk is high, reflecting the bank's reliance on efficient IT systems.
- The bank has a high, albeit well-managed, operational risk. Weighted by risk, the bank has strong capitalisation, but a small (absolute) capital base for its rating level.
- Fitch also believes that the bank's outsourcing of its IT activities is well controlled.
For more information, please read Fitch’s full Rating Action Commentary.