Fitch downgrades K&H to 'A' on Hungary's downgrade

Ratings

Fitch Ratings has today downgraded K&H Bank Rt's long-term rating to 'A' from 'A+'. The rating action follows yesterday's downgrade of the Hungarian sovereign long-term rating to 'BBB+' from 'A-' (A minus) and "Country Ceiling" to 'A' from 'A+'. Following the downgrade, K&H's outlook is now referred to as "stable".
The long-term, short-term and support ratings of K&H Bank are based on the potential support available from its 59% shareholder, KBC Bank, rated 'AA-' (AA minus). With total assets of Ft 1,733 billion at end-2004, K&H is the country's second largest banking group with a market share of around 13% in the corporate sector, where the bank has a strong franchise. The bank has operated in its current form since its merger in 2001 with ABN AMRO Magyar Bank, the Hungarian subsidiary of ABN AMRO. ABN AMRO remains a 40% shareholder of K&H Bank.

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