MOODY'S LOWERS LONG-TERM AND SHORT-TERM DEPOSIT RATINGS OF BANKERS TRUST AUSTRALIA LTD .(BTAL) TO A3 AND PRIME-2 FROM A1 AND PRIME-1 RESPECTIVELY, REFLECTING CHANGE IN OWNERSHIP. BTAL SUBORDINATED DEBT IS CONFIRMED AT A2, REFLECTING ASSUMPTION BY BANKERS
Moody's Investors Service today lowered the long-term and short-term deposit ratings of Bankers Trust Australia Ltd. (BTAL) to A3/Prime-2 from A1/Prime-1 respectively as well as the Bank Financial Strength rating to C from C+. These downgrades reflect the assumption of these obligations by Macquarie Bank Ltd, which is rated A3/Prime-2/C for long-term deposits, short-term deposits and bank financial strength respectively.
The rating on the subordinated debt of BTAL has been confirmed at A2, since these outstanding debts have been assumed by Bankers Trust Company (BTCo), which is rated A2 for subordinated debt.
The rating changes conclude a review process that was initiated in November 1998, after Deutsche Bank AG's (DB) announcement that it would acquire Bankers Trust Corporation and its subsidiaries. BTAL's ratings review was changed to direction uncertain in May 1999, when DB announced plans to sell all of the Australian operations of Bankers Trust.
Subsequently, in a three-way transaction, Deutsche Bank sold the Australian operations of Bankers Trust, consisting of asset management and investment banking businesses, to the Principal Financial Group. At the same time, Principal Financial Group retained the asset management businesses, and sold the investment banking business, including the BTAL legal entity, to Macquarie Bank Limited.
As part of the three-way transaction, BTCo has assumed the subordinated debt obligations of BTAL, by legally substituting itself as issuer of its outstanding BTAL subordinated notes. With effect from August 31, 1999, BTCo has replaced BTAL as the obligor on the subordinated notes and the notes have been assigned BTCo's subordinated debt rating of A2.
The new ratings assigned to BTAL reflect Macquarie Bank Ltd.'s ratings (A3/C/P-2), the acquiring bank and new obligor.
The following ratings have been lowered:
Bankers Trust Australia Ltd. - long-term bank deposits and issuer rating to A3 from A1; bank financial strength rating to C from C+; short-term bank deposits and Commercial Paper Program to Prime-2 from Prime-1.
The following rating has been confirmed:
Subordinated Step Up Notes of Bankers Trust Australia Ltd., assumed by Bankers Trust Company, at A2.
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