Moody's eyes Suncorp-Metway for upgrade

Moody's Investors Service said it placed on review for upgrade Suncorp-Metway Ltd.’s A1 long-term and senior unsecured ratings.

“This action follows the announcement that Australia and New Zealand Banking Group Ltd. has agreed to acquire SML,” the agency said in a press release. Concurrently, Moody’s placed Suncorp Group Ltd.’s A2 long-term issuer rating on review for downgrade. The outlooks were stable before being placed on review.

“This transaction, should it close, will be favorable for SML because it will be acquired by ANZ, a bank with a robust credit profile, strong access to capital markets, and a very high likelihood of support from the Australian government (Aaa stable), which lifts ANZ's long-term issuer rating and long-term senior unsecured ratings by two notches to Aa3. These benefits will likely result in a further uplift in SML's senior ratings due to higher government support assumptions,” Moody’s said in a press release.

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