Fitch upgrades KA Finanz

Fitch Ratings said it upgraded KA Finanz AG's subordinated Tier 2 notes to A from B and removed them from rating watch positive.

Fitch said the upgrade reflects the implementation of KA Finanz’s new funding mix, which considerably reduces the probability of default of the subordinated Tier 2 notes.

This follows the final approval by the Austrian banking regulator of the change, effective on Sept. 6, of KA Finanz’s legal status to a partially regulated run-off company pursuant to section 162 of the Austrian Bank Recovery and Resolution Act.

Following this regulatory approval, the agency said KA Finanz’s banking licence lapsed and most of its assets refinanced with long-term funds indirectly provided by the Austrian state (AA+/stable/F1+), which is also KA Finanz’s sole owner.

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