S&P cuts HSBC Bank to trAA-, view negative

Standard & Poor's said it lowered its long-term Turkey national scale rating on HSBC Bank AS to trAA- from trAA.

At the same time, the trA-1 short-term Turkey national scale and BB/B counterparty credit ratings were affirmed.

The outlook on the long-term counterparty credit rating was revised to negative from developing.

S&P said the actions follow the recent announcement by HSBC Group that it would retain and restructure its Turkish subsidiary HSBC Bank, as well as the high level of operating losses the bank reported for the financial year 2015.

The agency understands that none of the offers the group received since the entity was put up for sale in June 2015 were deemed to be in the best interests of the shareholders. In the absence of an immediate exit opportunity, the group has now decided to retain and restructure its Turkish operations, maintaining the wholesale banking business and refocusing its retail banking network.

S&P said it understands that the main growth engine will be the wholesale business and premium retail clients.

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