Fitch affirms Bank Victoria

Fitch Ratings said it affirmed PT Bank Victoria International Tbk.'s national long-term rating at BBB+(idn), along with its 10-year rupiah senior unsecured bonds issued in 2007 at BBB+(idn) and 10-year rupiah subordinated debt issued in 2007 at BBB(idn).

These issues do not have ongoing loss absorption features.

The outlook is stable.

The ratings reflect the improvement in the bank's capital position following a capital injection in the third quarter of 2011 and satisfactory liquidity, Fitch said.

The ratings also consider the bank's limited banking franchise with a concentrated loan and deposit portfolio and weakened asset quality, the agency said.

Liquidity remained fairly sound with liquid assets comprising cash, government bonds and central bank deposits amounting to 49% of total assets at the end of the first quarter of 2011, which mitigates the concentration risks typically present in the deposit base of small local banks in Indonesia, Fitch said.

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