S&P: AmBank, AmMerchant Bank unaffected

Standard & Poor's said ratings and outlook on Malaysia-based AmBank Bhd. (BBB-/stable/A-3) and AmMerchant Bank Bhd. (BB+/stable/B) are not affected by Australia and New Zealand Banking Group Ltd.'s (AA-/watch positive) proposed acquisition of a 20% to 25% equity stake in AMMB Holdings Bhd., which owns 100% of AmBank and 51% of AmMerchant.

S&P said it will monitor the outcome of negotiations for any rating implications for the banks, particularly the impact on capital position, as measured by the ratio of adjusted common equity to assets. There is potential for the banks to benefit from a strategic partnership with Australia and New Zealand Group, the agency said, because of the latter's retail banking, risk management, banking systems and cross-border capabilities.

The agency said it would revise the ratings outlook to positive from stable if the partnership, when approved, is expected to structurally improve the banks' business and financial profiles.

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