Security Bank said it decided to cancel its subscription to the credit rating services of Fitch Ratings, citing commercial considerations.
Fitch, for its part, it plans to withdraw all ratings for Security Bank on or about November 16 this year, or around 30 days from the date of the notice.
Fitch currently rates Security Bank’s national long-term rating with a high investment grade of ‘AA’ with a stable outlook.
Its other ratings for the bank were: ‘BB+’ for long-term foreign-currency issue default ratings (IDR); short-term IDR of ‘B’; long-term local-currency IDR of ‘BB+’; viability rating of ‘bb+’; support rating of ‘3’; and support rating floor of ‘BB-’.
Fitch said it reserves the right in its sole discretion to withdraw or maintain any rating at any time for any reason it deems sufficient.
“Fitch believes that investors benefit from increased rating coverage by Fitch and is providing approximately 30 days’ notice to the market of the rating withdrawal of Security Bank Corporation,” the debt rater said in a statement.
Separately, Security Bank said that it is the industry practice to use only two credit rating firms to assess a bank’s credit standing. Most banks in the Philippines use only two credit rating agencies.
It decided to go with Standard & Poor’s and Moody’s Investor Services.
“Security Bank has been executing the practice for a long time now. We have maintained our relationship with Standard and Poor’s and Moody’s,” the bank said in a statement.
“Fitch’s withdrawal of its credit rating on Security Bank is expected due to the commercial decision the Bank has made,” it said, and does not reflect the bank’s credit standing and financial performance, the bank said.