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DBRS rates German bank NORD/LB following action on Sparkassen-Finanzgruppe

DBRS on June 11 assigned first-time A/R-1(low) long- and short-term issuer and deposit ratings to Norddeutsche Landesbank Girozentrale, or NORD/LB, following the March 27 action on Sparkassen-Finanzgruppe, of which it is a member.

The agency also assigned the bank an A long-term senior debt rating and an R-1(low) short-term debt rating.

The issuer and debt ratings are based on NORD/LB being a member of Sparkassen-Finanzgruppe's Institution Protection Scheme. All members of the scheme are generally rated A, DBRS said.

The agency also assigned the bank a BBB (low) intrinsic assessment and a SA1 support assessment, with the latter based on expected high level of support from the banking group it belongs to.

The trend on all the ratings is positive, reflecting that on Sparkassen-Finanzgruppe. DBRS sees the profitability in the sparkassen sector remaining resilient despite the low interest rate environment and the further de-risking of the wholesale banking sector. The group has made consistent progress in improving its capital position, DBRS noted.

NORD/LB offers services in the energy and infrastructure sector, ship and aircraft finance, corporate client business, commercial real estate finance, capital market business and private and commercial client business including private banking.