Moody’s lifts three Slovenian banks

Moody's Investors Service said it upgraded the ratings of the following three Slovenian banks, concluding the review for upgrade initiated on Aug. 4:

• Nova Ljubljanska banka dd: Long-term local and foreign-currency deposit ratings upgraded to Ba3 from B2, long-term counterparty risk assessment (CRA) upgraded to Ba2(cr) from Ba3(cr), baseline credit assessment (BCA) and adjusted BCA upgraded to b3 from caa1; outlook on the long-term deposit ratings is positive;

• Nova Kreditna banka Maribor dd: Long-term local and foreign-currency deposit ratings upgraded to B2 from B3, BCA and adjusted BCA upgraded to b3 from caa1, long-term CRA affirmed at Ba3(cr); outlook on the long-term deposit ratings is positive; and

• Abanka dd: Long-term local and foreign-currency deposit ratings upgraded to Ba3 from B3, long-term CRA upgraded to Ba2(cr) from Ba3(cr), BCA and adjusted BCA upgraded to b2 from caa1; outlook on the long-term deposit ratings is positive.

All short-term deposit ratings and short-term CRA rating inputs of the banks were unaffected by these actions.

Moody’s said the review was prompted by the agency's change of its macro profile for Slovenia to "moderate-" from "weak+." The strengthening of the macro profile is driven by the improvement in the Slovenian banks' operating environment, in particular a significant improvement in the banks' funding conditions following a reduction in wholesale borrowings in the past few years. A gradual recovery in credit demand should support banks' lending growth and revenues after several years of loan book contraction.

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