Fitch: ING convertibles BB

Fitch Ratings said it assigned a final rating of BB to ING Group’s issue of additional tier 1 convertible notes.

The final rating is in line with the expected rating assigned to the notes April 7, Fitch said.

The notes are CRD IV-compliant perpetual additional tier 1 contingent convertible capital securities, Fitch said. The notes are subject to automatic conversion if ING Group’s consolidated common equity tier 1 ratio falls to less than 7%, the agency said, and any coupon payments may be cancelled at the discretion of the group.

The rating is five notches below ING Group’s implicit intrinsic creditworthiness, Fitch said.

This reflects somewhat higher risk in ING Group as a holding company compared with its main operating company, ING Bank, which has A+ ratings, the agency said.

The notching reflects the notes’ higher expected loss severity when compared with average recoveries, as well as high risk of non-performance, Fitch said.

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