S&P ups Bank Negara local rating

Standard & Poor's said it raised its long-term local currency rating on PT Bank Negara Indonesia (Persero) Tbk to B+ from B. The outlook on the long-term local currency rating is stable.

At the same time, the B foreign currency ratings and short-term local currency rating have been affirmed. S&P also revised its outlook on the long-term foreign currency rating for Bank BNI to positive from stable.

The issue ratings on Bank BNI's subordinated debt of $150 million due 2012 and $100 million due 2013 have also been raised to B- from CCC+, while its senior unsecured debt of $145 million due 2007 was affirmed at B.

"The upgrade in the long-term local currency rating on Bank BNI reflects the continued improvement in its key fundamentals such as underlying profitability and capitalization," said S&P credit analyst Adrian Chee.

"The ratings also acknowledge the changes and initiatives undertaken since its letters of credit graft case in 2003 to improve its internal controls and systems, although any beneficial impact, particularly arising from the bank's new board of directors, is expected over the near to medium term."

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