Fitch Ratings upgrades Hungarian banks

Ratings

Fitch Ratings today upgraded the credit ratings of Hungarian banks in connection with the recently announced upgrade of the countryʼs sovereign debtor rating Hungarian news agency MTI reported.

The international ratings agency said in London on Tuesday that it upgraded the long-term ratings of MFB and Eximbank by one notch to "BBB-" from "BB+". It also upgraded by one notch the long-term ratings of Erste Bank Hungary and K&H Bank to "BBB" from "BBB-", affirming the rating of CIB Bank at "BBB-".

All ratings are on stable outlooks.

The ratings actions follow the upgrade of Hungaryʼs long-term issuer default rating (IDR) to "BBB-" from "BB+" with a stable outlook, announced on May 20, Fitch Ratings said.

The upgrades of state-owned MFB and Eximbank reflect the improved ability of the government to provide extraordinary support, in case of need, as reflected in the upgrade of Hungaryʼs long-term rating, while the propensity to support both banks remains strong, Fitch said. 

The upgrades of K&H and Erste Bank Hungary are driven by the upgrade of the Hungarian sovereign and Fitchʼs unchanged view of the ability and propensity of their respective parents - KBC Bank and Erste Group Bank AG to provide support, it added.

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