January 15, 2013 / 10:37 AM / 5 years ago

TEXT-Fitch rates OCBC NISP's senior bond programme 'AAA(idn)'

(The following statement was released by the rating agency)

Jan 15 - Fitch Ratings has assigned Indonesia-based PT Bank OCBC NISP Tbk’s (OCBC NISP, ‘AAA(idn)'/Stable) a unsecured senior debt programme of up to IDR6trn a National Long-Term rating of ‘AAA(idn)'. The agency has also assigned OCBC NISP and its programme a National Short-Term rating of ‘F1+(idn)'.

In addition, Fitch has assigned ‘AAA(idn)’ to OCBC NISP’s senior unsecured bond tranche I 2013, to be issued under the programme, of up to IDR3trn with a maturity of up to three years. Proceeds from the issue will be used to support business growth. The bank has up to two years to issue bonds under the senior unsecured debt programme.

The bonds are rated at the same level as OCBC NISP’s National ‘AAA(idn)’ Long-Term rating to reflect Fitch’s view that they represent direct, unconditional, unsecured and unsubordinated obligations of the company.

The ratings reflect Fitch’s expectation that OCBC NISP will continue to receive strong support from its parent, Oversea-Chinese Banking Corp (OCBC, ‘AA-'/Stable), which is rated higher than Indonesia’s Country Ceiling of ‘BBB’, equivalent to ‘AAA(idn)’ on the National Rating scale. Fitch’s view of support is reinforced by OCBC NISP’s strategic importance to OCBC’s regional business growth, the parent’s majority ownership and close integration between the two entities, in name association and operational alignment in most key areas.

Any significant dilution in ownership by, or perceived weakening of support from, OCBC would put pressure on OCBC NISP’s ratings. Upside potential for OCBC NISP’s IDR may result from an upgrade of the Indonesian Country Ceiling.

Established in 1941, OCBC NISP was previously owned by the Surjaudaja family, and weathered the 1997-1998 Asian crisis without a state bailout. OCBC, which acquired 22.5% of OCBC NISP in mid-2004, now owns 85.08% following a merger between OCBC Indonesia and OCBC NISP on January 2011.

OCBC NISP’s ratings:

Long-Term Foreign and Local Currency IDRs: ‘BBB’; Outlook Stable

Short-Term Foreign Currency IDR: ‘F3’

National Long-Term rating: ‘AAA(idn)'; Outlook Stable

National Short-Term rating: ‘F1+(idn)’

Viability Rating: ‘bb’

Support Rating: ‘2’

Subordinated bond: ‘AA(idn)'

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