S&P lifts Shinsei Bank view to stable

Standard & Poor’s said it revised the outlooks to stable from negative on the long-term counterparty credit ratings on Shinsei Bank Ltd. and subsidiary Shinsei Financial Co. Ltd.

The agency also said it affirmed the counterparty credit ratings on the two entities and the debt rating on the subordinated debt issued by Shinsei Bank.

S&P also said it raised by one notch the rating on Shinsei Bank’s preferred shares issued through group subsidiaries to BB from BB-.

The outlook revision reflects an increased likelihood that Shinsei Bank’s risk position has improved due to the group’s initiatives to streamline its businesses and lift asset quality, the agency said.

The company has reduced non-core assets such as securitized products and private equity investments that were among the main causes of massive losses in the past, S&P said.

But Shinsei Bank’s exposures to structured finance, partly through its real estate-related lending and unsecured loans are high among Japanese peers, S&P said.

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