S&P Global Ratings on Oct. 5 assigned Adam & Co. Plc BBB+/A-2 preliminary long- and short-term issuer credit ratings, with a stable outlook.
The agency said it assigned the preliminary ratings based on its expectation that the formal separation of parent Royal Bank of Scotland Group Plc's banking operations to comply with the U.K.'s ring-fencing requirements will be completed as planned in the first half of 2018.
The plan will see most of RBS group unit Royal Bank of Scotland Plc's existing personal, private, business and commercial customers transferred to Adam & Co., which will be a ring-fenced bank within the ring-fenced group and will be renamed Royal Bank of Scotland Plc.
S&P noted that it sees Adam & Co. as a core operating subsidiary of the group, adding that the preliminary ratings will likely be converted to final ratings once the group receives U.K. court approval for the associated transfer business, which the agency expects to occur in the first half of 2018. The stable outlook on Adam & Co., meanwhile, reflects the outlook on the group.
At the same time, S&P affirmed its BBB+/A-2 ratings and revised its outlook to negative from stable on RBS group subsidiaries Royal Bank of Scotland Plc, Royal Bank of Scotland NV and U.S.-based RBS Securities Inc., which the agency said it expects to continue to provide investment banking services situated outside the ring-fence.
S&P said the negative outlook reflects that the group's future reorganization could change the creditworthiness of the units, adding that it will likely rate the entities one notch below the main ring-fenced operating banks.
S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.
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