Fitch shifts Volksbank view to stable

Fitch Ratings said it revised Volksbank NV's outlook to stable from negative while affirming the bank's long-term issuer default rating at A-.

“The outlook revision reflects our view that Volksbank's rating has sufficient headroom to absorb significant shocks under our updated assessment of various downside scenarios to our baseline economic forecast,” Fitch said in a press release.

The bank's common equity tier 1 ratio of 33.8% and total capital ratio of 39.1% provide strong buffers above the revised regulatory requirements and will enable the bank to withstand asset quality deterioration, Fitch said.

“The bank's capital ratios greatly benefit from the low risk-weighting of mortgage loans, which represent nearly 75% of its total assets, but remain robust when accounting for the expected inflation of risk-weighted assets (RWA) from Basel III end-game rules,” Fitch said.

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