Fitch assigns KBC notes BB(EXP)

Fitch Ratings said it assigned KBC Group's (A-/stable/F1) planned issue of additional tier 1 capital notes an expected rating of BB(EXP).

The rating assigned to the notes is notched off KBC Group's implicit intrinsic creditworthiness, of which KBC Bank (A-/stable/a-) is the predominant operating entity.

The notes are rated five notches below this implicit intrinsic creditworthiness in accordance with Fitch's criteria for "Assessing and Rating Bank Subordinated and Hybrid Securities."

The notching reflects the notes' higher expected loss severity relative to senior unsecured creditors (two notches) and higher non-performance risk (three notches), Fitch said.

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