MOODY'S UPGRADES LONG-TERM RATINGS OF LEEDS PERMANENT BUILDING SOCIETY (SENIOR TO Aa1)
London, 07-12-95 -- Moody's Investors Service upgraded the long-term ratings of Leeds Permanent Building Society (senior to Aa1 from Aa3), in recognition of this building society's upcoming merger with Halifax Building Society. This rating action concludes a review initiated on 28 November, 1994, when the merger project -- to take place through a transfer of engagements from Leeds Permanent to Halifax -- was first announced by these two societies. According to Moody's, the upgrade reflects the positive impact for Leeds Permanent's creditors of this building society's merger into Halifax (whose Aa1/Prime-1 deposit ratings were confirmed at the time of the merger announcement). At the same time, Moody's said that, following the completion of this merger (expected to occur in August 1995), the existing ratings of Leeds Permanent for which this society will cease being the nominal obligor may be withdrawn.
The merger of the two building societies is likely to strengthen Halifax's dominant position in the U.K. mortgage and savings markets even further. The rating agency added that postmerger it expects Halifax -- even after its conversion to a bank status -- to pursue its growth and diversification strategy without hampering its strong financial characteristics, including its ample capitalisation.
The following ratings were upgraded:
Leeds Permanent Building Society - the long-term rating for deposits and senior debt to Aa1 from Aa3, the society's subordinated debt rating to Aa3 from A2, and the permanent interest-bearing shares rating to A1 from Baa1.
The following ratings were confirmed:
Leeds Permanent's Prime-1 rating for short-term deposits and commercial paper.
Leeds Permanent Building Society is headquartered in Leeds, and its consolidated assets amounted to GBP 20.6 billion (approximately USD 33 billion) as of 30 September 1994.
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