Fitch revises KBC to positive

Fitch Ratings said it revised KBC Bank's outlook to positive from stable and affirmed its long-term issuer default rating at A.

KBC Groep NV's (KBC Group) long-term issuer default rating was also affirmed at A, with a stable outlook.

Both KBC Bank's and KBC Group's viability ratings were affirmed at a and senior debt ratings at A.

In addition, Fitch affirmed KBC Verzekeringen's and KBC Group Re's insurer financial strength ratings at A+, and KBC Verzekeringen's long-term issuer default rating at A. The outlooks are stable.

Fitch said the outlook revision reflects its expectation that the bank's long-term issuer default rating might be rated one notch above the bank's viability rating following the build-up of a significant and sustainable junior debt buffer at the bank that provides additional protection for the bank's senior unsecured creditors.

“KBC Bank has proposed a single point of entry approach at the level of KBC Group and most debt issued out of the holding company is streamed down to the bank in a subordinated form that ranks junior to senior creditors to meet the upcoming minimum requirement for eligible liabilities and own funds,” the agency said in a news release.

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