Standard and Poor's raises TSB Bank's rating

TSB Bank's successful expansion of its business has prompted Standard & Poor's to raise its credit ratings on the Taranaki-based bank today.

S&P's raised its long-term rating on TSB to 'BBB' from 'BBB-', and lifted its short-term rating to 'A-2' from 'A-3', with a stable outlook.

"The ratings upgrade reflects TSB Bank's broadened business profile, with a progressively strengthening financial profile," Standard & Poor's credit analyst Derryl D'silva said.

"Specifically, TSB Bank has been successful in its strategy to expand organically, while demonstrating strong asset quality and liquidity," he said.

Offsetting that was its reliance on interest income and limited capital flexibility, due to its trust-based ownership.

TSB's rating would improve if it developed further business outside its home Taranaki region, and increased earnings and funding flexibility, Mr D'silva said.

- NZPA