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According to Market Intelligence, April 2023

S&P, Moody's act on Banco BPI

S&P Global Ratings on Jan. 18 revised the CreditWatch status on the BB- long-term counterparty credit rating of Banco BPI SA and core unit Banco Português de Investimento SA to positive from developing and affirmed the two institutions' B short-term ratings.

The action on the Portuguese lender follows CaixaBank SA's launch of an offer to shareholders for the 55% of BPI that it does not already own, at €1.134 per share. The CreditWatch positive status reflects the possibility of CaixaBank taking control of the bank and the potential for a boost to BPI's long-term rating as a result of parental support, S&P said.

Meanwhile, Moody's upgraded BPI's adjusted baseline credit assessment to "ba3" from "b1" and its long-term counterparty risk assessment to Ba1(cr) from Ba2(cr). The agency also confirmed the bank's "b1" baseline credit assessment and Ba3 long-term senior debt and deposit ratings.

The outlook on the long-term senior debt and deposit ratings is stable. The actions conclude a review for downgrade launched in March 2016.

The confirmation of BPI's baseline credit assessment reflects the transfer of its 2% stake in Banco de Fomento Angola SA to Angolan mobile operator Unitel SA, which in the agency's view eliminated a breach of large exposure limits and hence the risk of supervisory sanctions. The upgrade of the adjusted baseline credit assessment reflects factors including the likelihood of affiliate support from CaixaBank, while the confirmation of the debt and deposit ratings reflects the actions on the baseline and adjusted baseline credit assessments, among others.

Separately, Moody's revised the outlook on CaixaBank's long-term senior debt and deposit ratings to stable from negative.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.