International rating agency Moody’s has affirmed the ratings assigned for the first time in 2023 to Romanian financial group Banca Transilvania (BVB: TLV) and improved the outlook on the long-term deposit (Baa2) and issuer ratings (Baa3) to positive from stable.<\/p>\n
Low dependence of market funding and high profitability balances against risks posed by foreign currency lending and lending to high-risk market segments (SMEs mainly), while the improved outlook reflects the recently issued meaningful volumes of senior non-preferred instruments.<\/p>\n
The rating agency explains that the affirmation of the bank’s Baseline Credit Assessment (ba1) reflects its robust capitalization, with tangible common equity to risk-weighted assets of 16.1% as of June 2024, and strong profitability supported by the bank’s leading market position in Romania along with good cost efficiency.\u00a0<\/p>\n
The bank further displays a very low market funding reliance (mostly driven by regulatory requirements), a granular deposit-based funding structure, and ample liquidity, with its loan-to-deposit ratio in a range of around 50% to 60% over the past few years.<\/p>\n
These strengths are balanced against elevated asset risks related to the bank’s material share of foreign-currency lending at around one-third of the loan book, as well as its credit exposure to higher-risk segments, like small businesses and consumer lending. There are also tail risks from a high share of foreign currency \u2013 mainly euro \u2013 liabilities at 41% of the total as of the end of 2023 and some concentration in the bank’s liquid assets towards Romanian government securities.<\/p>\n
The affirmation also reflects the credit impact from various acquisitions over the past year, balancing financial and strategic benefits and related integration risks.<\/p>\n
The positive outlook on the bank’s long-term deposit and issuer ratings reflects the strengthened loss protection amid recently issued meaningful volumes of senior non-preferred instruments, \u00a0now indicating potentially lower loss-given-failure for senior creditors and, if maintained as a proportion of assets, or if supported by future issuance of subordinated debt instruments, could drive additional LGF uplift for depositors and senior unsecured debt obligations.<\/p>\n
iulian@romania-insider.com<\/em><\/p>\n (Photo source: Banca Transilvania)<\/em><\/p>","protected":false},"excerpt":{"rendered":" International rating agency Moody’s has affirmed the ratings assigned for the first time in 2023 to Romanian financial group Banca Transilvania (BVB: TLV) and improved the outlook on the long-term deposit (Baa2) and issuer ratings (Baa3) to positive from stable. Low dependence of market funding and high profitability balances against risks posed by foreign currency […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2618","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/posts\/2618","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2618"}],"version-history":[{"count":0,"href":"https:\/\/ofero.news\/index.php?rest_route=\/wp\/v2\/posts\/2618\/revisions"}],"wp:attachment":[{"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2618"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2618"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ofero.news\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2618"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}