Kiwibank ownership change would trigger review - S&P
Standard&Poor's assesses the chances of a privatisation of Kiwibank as low and is keeping its AA minus rating of the state-owned bank unchanged as a result.But it said any change in ownership of the bank would trigger a review of its credit rating.The
Standard&Poor's assesses the chances of a privatisation of Kiwibank as low and is keeping its AA minus rating of the state-owned bank unchanged as a result.
But it said any change in ownership of the bank would trigger a review of its credit rating.
The ratings agency released a statement today saying its ratings of the bank were unchanged following speculation about the possible privatisation, and also following the recent announcement of the current chief executive's retirement.
"Our ratings continue to reflect our expectation that notwithstanding the recent discussion on possible privatisation of Kiwibank, the risk of privatisation remains low in the medium term.
"Nevertheless, in our less-likely downside scenario, privatisation of the bank would be expected to put downward pressure on the ratings."
The current ratings on Kiwibank are equalised with the bank's wholly government-owned parent New Zealand Post Ltd. The ratings on the bank get a significant uplift from the bank's stand-alone credit profile due to an unconditional and irrevocable guarantee from the parent.
Consequently, any change in the bank's ownership -- which would likely be accompanied by a dilution in the parent guarantee -- would be a possible trigger for rating review.
"We do not expect any disruption in the bank's strategy or operations due to the retirement of the chief executive. We consider this transition to be a part of an orderly succession."
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