Fitch places Kiwibank on watch

Fitch Ratings said it placed ratings of Kiwibank Ltd.’s guaranteed senior unsecured debt on rating watch negative following an error the agency made.

“The RWN on Kiwibank's guaranteed senior unsecured debt ratings follows Fitch erroneously equalizing the ratings with those of the New Zealand sovereign, despite the guarantor being New Zealand Post Limited rather than the sovereign, and Fitch not assessing the creditworthiness of the guarantor, New Zealand Post,” the agency said in a press release.

Fitch hasn’t finished assessing the creditworthiness of New Zealand Post, which could be lower than the national government’s rating, it said. New Zealand Post is 100% owned by the country’s government.

“A one notch downgrade of Kiwibank's guaranteed senior unsecured debt is likely if Fitch were to determine that New Zealand Post's creditworthiness is lower than that of the New Zealand sovereign,” Fitch said.

Fitch affirmed Kiwibank’s long-term foreign currency issuer default rating at AA-.

The outlook is stable.

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