The Bank of the Philippine Islands (BPI) is now the only Philippine bank rated investment-grade by two international rating agencies, Moody’s Investors Service and Fitch Ratings.
Moody’s Investors Service views the credit profile of BPI to be among the “most defensive and best positioned to withstand a cyclical downturn among Moody’s rated banks in the Philippines.”
In October, Moody’s raised BPI’s baseline credit assessment from “ba1” to “baa3.” Baseline credit assessment is the evaluation of the issuer’s stand-alone financial strength, excluding extraordinary government support.
It also upgraded BPI’s deposit rating to “Baa3/Prime-3” from “Ba1/Not Prime,” with a positive outlook in line with the positive outlook of Philippine government’s bond rating.
Meanwhile, Fitch Ratings said that the capacity of BPI to pay its financial commitments is considered “adequate.”
In the early part of 2013, Fitch raised BPI’s LTFC IDR, or long-term foreign currency issuer default rating, to investment grade “BBB-” from “BB+.” BBB ratings indicate good credit quality, with low expectation of default risk.
It said that the LTFC IDR upgrade is in line with the bank’s LTLC (long-term local currency) IDR rating of “BBB-.” The outlook on the IDR is stable.
“BPI’s LTFC IDR had been until now constrained by the sovereign’s LTFC IDR of BB+, due to the bank’s exposure to the financial health of the government, wider domestic economy and local financial markets,” Fitch said.
“Of the major Philippine banks rated by Fitch, BPI’s ratings have been the highest, due to its established domestic presence, sound financial metrics and prudent management,” Fitch added.