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Moody's upgrades Hungary's K&H Bank

Moody's on June 7 upgraded Kereskedelmi és Hitelbank Zrt.'s long- and short-term local-currency bank deposit ratings to Baa2/P-2 from Baa3/P-3, with a positive outlook on the long-term rating.

At the same time, the rating agency affirmed the Hungary-based lender's long- and short-term foreign-currency bank deposit ratings at Baa3/P-3 and its long- and short-term counterparty risk assessments at Baa2(cr)/P-2(cr), with a stable outlook on the long-term foreign-currency bank deposit rating.

Moody's said the ratings actions were driven by higher results and thus higher rating uplift for the bank's deposit ratings from the agency's advanced loss-given-failure analysis, following changes in the lender's liability structure as of December 2017.

The upgrade of the bank's ratings reflects its "ba3" baseline credit assessment, Moody's assessment of continued high support from parent KBC Bank NV, the result of the agency's advanced loss-given-failure analysis and Moody's continued assumptions of low support from the Hungarian government, the agency added.

The ultimate parent of K&H Bank and KBC Bank is KBC Group NV.