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S&P acts on 2 Liechtenstein lenders

S&P Global Ratings on May 17 took actions on Liechtenstein-based lenders VP Bank AG and LGT Bank AG, citing their strong business development over the course of 2017.

The agency upgraded VP Bank's long- and short-term issuer credit ratings to A/A-1 from A-/A-2, reflecting its improved franchise and business stability, which prompted S&P to reevaluate its business position as moderate. S&P said it expects the lender to maintain its robust profitability metrics while continuing to invest in its IT systems and additional client investors.

The outlook on VP Bank's long-term rating was revised to stable from positive, reflecting the agency's view that the lender will further invest in its existing franchise, which will support net new money growth and good financial performance.

Meanwhile, S&P affirmed LGT Bank's long- and short-term issuer credit ratings at A+/A-1 and revised the outlook on the long-term rating to positive from stable. The positive outlook reflects the agency's expectation that the lender's improving risk-adjusted profitability will help support a further increase in capital. S&P said it expects LGT Bank to boost its capital and earnings and improve its risk position over the next 24 months.

In addition, S&P upgraded VP Bank's senior unsecured rating to A from A-, while LGT Bank's senior unsecured rating was affirmed at A+.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found here.