Junior Senior unsecured ratings of four banks upgraded, senior unsecured rating of one bank affirmed
Paris, July 13, 2021 -- Moody's Investors Service (Moody's) has today taken rating actions on
four French banks, namely BPCE, Credit Agricole S.A.,
Banque Federative du Credit Mutuel and Credit Mutuel Arkea. The
rating actions were driven by revisions to Moody's Advanced Loss
Given Failure (Advanced LGF) framework, which is applied to banks
operating in jurisdictions with Operation Resolution Regimes, following
the publication of Moody's updated Banks Methodology on 9 July 2021.
This methodology is available at this link: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1269625
All other French banks were unaffected by today's rating action
and the update of the Banks methodology.
A full list of affected ratings can be found at the end of this press
release.
RATINGS RATIONALE
Today's rating actions on four French banks and branches were driven by
revisions to the Advanced Loss Given Failure framework within Moody's
updated Banks methodology.
In particular, ratings were impacted by revised notching guidance
table thresholds at lower levels of subordination and volume in the liability
structure, which have been applied to all French banks. For
French banks with overseas subsidiaries the rating actions also incorporate
Moody's view that group-wide resolutions coordinated in a unified
manner will be more common following the requirement to issue internal
loss absorbing capital (ILAC), leading to a likely transfer of losses
from subsidiaries to parents at the point of failure. The update
further includes the consideration of all Additional Tier 1 (AT1) securities
issued by banks domiciled in France in Moody's Advanced LGF framework,
eliminating the previous analytical distinction between those high trigger
instruments that were deemed to provide equity-like absorption
of losses before the point of failure and other AT1 securities.
RATINGS RATIONALE FOR INDIVIDUAL BANKS
- BPCE
Moody's affirmed the A1 senior unsecured rating of BPCE with stable
outlook and upgraded the junior senior unsecured debt of BPCE to Baa1
from Baa2.
Moody's Advanced LGF analysis shows a very low loss-given-failure
for the senior unsecured ratings while the previous LGF showed a low loss-given-failure
for this class of debt. However the assigned LGF notching remains
unchanged at two notches as under the previous methodology, it was
positioned one notch higher than that indicated by the LGF analysis to
reflect a forward looking view of bank's issuance of senior and
subordinated debt.
BPCE's long-term junior senior ratings was upgraded by one
notch, as under Moody's Advanced LGF analysis they are now
rated in line with the baa1 Adjusted Baseline Credit Assessment (Adjusted
BCA), which better captures the risk characteristics of this class
of debt following the agency's revised view around the distribution
of losses post failure.
- Credit Agricole S.A.
Moody's upgraded the long-term junior-senior unsecured
debt ratings of Credit Agricole S.A. (CASA) to A3 from Baa1
and the long-term junior senior unsecured MTN ratings to (P)A3
from (P)Baa1.
CASA's long-term junior senior ratings of A3 were upgraded
by one notch, as under Moody's Advanced LGF analysis they
are now rated in line with the a3 Adjusted BCA of CASA, which better
captures the risk characteristics of this class of debt following the
agency's revised view around the distribution of losses post failure.
- Banque Federative du Credit Mutuel
Moody's upgraded the junior senior unsecured debt rating and the
junior senior unsecured MTN programme rating of Banque Federative du Credit
Mutuel (BFCM) to A3 from Baa1 (and to (P)A3 from (P)Baa1 for the programme).
BFCM's junior senior ratings of A3 were upgraded by one notch,
as under Moody's Advanced LGF analysis they are now rated in line
with BFCM's BCA of a3, which better captures the risk characteristics
of this class of debt following the agency's revised view around
the distribution of losses post failure.
- Credit Mutuel Arkea
Moody's upgraded the junior senior unsecured debt rating and the
long-term junior senior unsecured MTN programme rating of Credit
Mutuel Arkea to A3 from Baa1 and to (P)A3 from (P)Baa1 for the programme.
Credit Mutuel Arkea's junior senior ratings of A3 were upgraded
by one notch, as under Moody's Advanced LGF analysis they
are now rated in line with Credit Mutuel Arkea's Adjusted BCA of
a3, which better captures the risk characteristics of this class
of debt following the agency's revised view around the distribution
of losses post failure.
OUTLOOK
The rating outlook for BPCE remains stable. The rating outlook
for the other banks affected by today's rating action remains unchanged.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The affected long-term senior unsecured debt ratings, issuer
ratings and junior senior ratings could be upgraded following an improvement
in the standalone creditworthiness of the banks, or an upgrade of
the relevant country sovereign debt rating.
The long-term senior unsecured debt ratings and issuer ratings
could also be upgraded following a significant increase in the stock of
more junior bail-in-able liabilities.
The affected ratings and assessments could be downgraded following a substantial
deterioration in the standalone creditworthiness of the banks or following
a significant reduction in the stock of bail-in-able liabilities.
LIST OF AFFECTED RATINGS
..Issuer: Credit Agricole S.A.
Upgrades:
....Junior Senior Unsecured Regular Bond/Debenture,
upgraded to A3 from Baa1
....Junior Senior Unsecured Shelf, upgraded
to (P)A3 from (P)Baa1
....Junior Senior Unsecured Medium-Term
Note Program, upgraded to (P)A3 from (P)Baa1
..Issuer: Credit Agricole S.A.,
London Branch
Upgrades:
....Junior Senior Unsecured Regular Bond/Debenture,
upgraded to A3 from Baa1
....Junior Senior Unsecured Shelf, upgraded
to (P)A3 from (P)Baa1
....Junior Senior Unsecured Medium-Term
Note Program, upgraded to (P)A3 from (P)Baa1
..Issuer: Banque Federative du Credit Mutuel
Upgrades:
....Junior Senior Unsecured Regular Bond/Debenture,
upgraded to A3 from Baa1
....Junior Senior Unsecured Medium-Term
Note Program, upgraded to (P)A3 from (P)Baa1
..Issuer: Credit Mutuel Arkea
Upgrades:
....Junior Senior Unsecured Regular Bond/Debenture,
upgraded to A3 from Baa1
....Junior Senior Unsecured Medium-Term
Note Program, upgraded to (P)A3 from (P)Baa1
..Issuer: BPCE
Upgrades:
....Junior Senior Unsecured Regular Bond/Debenture,
upgraded to Baa1 from Baa2
....Junior Senior Unsecured Shelf, upgraded
to (P)Baa1 from (P)Baa2
....Junior Senior Unsecured Medium-Term
Note Program, upgraded to (P)Baa1 from (P)Baa2
Affirmations:
....Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable
....Backed Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable
....Senior Unsecured Shelf, affirmed
(P)A1
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
....Backed Senior Unsecured Medium-Term
Note Program, affirmed (P)A1
Outlook Action:
....Outlook remains Stable
..Issuer: Banque Populaire Alsace Lorraine Champagne
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire Aquitaine Centre Atlantique
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire Atlantique
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire Auvergne Rhone Alpes
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
....Long-term Issuer Ratings,
affirmed A1, outlook remains Stable
Outlook Action:
....Outlook remains Stable
..Issuer: Banque Populaire de l'Ouest
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire du Massif Central
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire du Nord
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire Grand Ouest
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire Rives de Paris
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Banque Populaire Val de France
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: BRED-Banque Populaire
Upgrades:
....Junior Senior Unsecured Medium-Term
Note Program, upgraded to (P)Baa1 from (P)Baa2
Affirmations:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Caisses d'Epargne Participations
Affirmations:
....Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable (Assumed by BPCE)
..Issuer: CASDEN - Banque Populaire
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Credit Cooperatif
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: Credit Foncier de France
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
..Issuer: IXIS Corporate & Investment Bank
Affirmations:
....Backed Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable (Assumed by Natixis)
....Backed Senior Unsecured Medium-Term
Note Program, affirmed (P)A1
..Issuer: Natixis
Affirmations:
....Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
....Backed Senior Unsecured Medium-Term
Note Program, affirmed (P)A1
....Long-term Issuer Rating,
affirmed A1, outlook remains Stable
Outlook Action:
....Outlook remains Stable
..Issuer: Natixis Funding Corp.
Affirmations:
....Backed Long-term Issuer Ratings,
affirmed A1, outlook remains Stable
Outlook Action:
....Outlook remains Stable
..Issuer: Natixis Securities Americas LLC
Affirmations:
....Backed Long-term Issuer Ratings,
affirmed A1, outlook remains Stable
Outlook Action:
....Outlook remains Stable
..Issuer: Natixis Loan Funding-Comp BPCE
Affirmations:
....Backed Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable
....Backed Senior Unsecured Medium-Term
Note Program, affirmed (P)A1
Outlook Action:
....Outlook remains Stable
..Issuer: NATIXIS Structured Products Limited
Affirmations:
....Backed Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable
....Backed Senior Unsecured Medium-Term
Note Program, affirmed (P)A1
Outlook Action:
....Outlook remains Stable
..Issuer: Natixis US Medium-Term Note Program
LLC
Affirmations:
....Backed Senior Unsecured Regular Bond/Debenture,
affirmed A1, outlook remains Stable
....Backed Senior Unsecured Medium-Term
Note Program, affirmed (P)A1
Outlook Action:
....Outlook remains Stable
..Issuer: Natixis, New York Branch
Affirmation:
....Senior Unsecured Medium-Term Note
Program, affirmed (P)A1
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Banks Methodology
published in July 2021 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1269625.
Alternatively, please see the Rating Methodologies page on www.moodys.com
for a copy of this methodology.
REGULATORY DISCLOSURES
For further specification of Moody's key rating assumptions and
sensitivity analysis, see the sections Methodology Assumptions and
Sensitivity to Assumptions in the disclosure form. Moody's
Rating Symbols and Definitions can be found at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004.
For ratings issued on a program, series, category/class of
debt or security this announcement provides certain regulatory disclosures
in relation to each rating of a subsequently issued bond or note of the
same series, category/class of debt, security or pursuant
to a program for which the ratings are derived exclusively from existing
ratings in accordance with Moody's rating practices. For ratings
issued on a support provider, this announcement provides certain
regulatory disclosures in relation to the credit rating action on the
support provider and in relation to each particular credit rating action
for securities that derive their credit ratings from the support provider's
credit rating. For provisional ratings, this announcement
provides certain regulatory disclosures in relation to the provisional
rating assigned, and in relation to a definitive rating that may
be assigned subsequent to the final issuance of the debt, in each
case where the transaction structure and terms have not changed prior
to the assignment of the definitive rating in a manner that would have
affected the rating. For further information please see the ratings
tab on the issuer/entity page for the respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this credit rating action,
and whose ratings may change as a result of this credit rating action,
the associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
The ratings have been disclosed to the rated entity or its designated
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Regulatory disclosures contained in this press release apply to the credit
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review.
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and governance (ESG) risks in our credit analysis can be found at http://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1288435.
The Global Scale Credit Rating on this Credit Rating Announcement was
issued by one of Moody's affiliates outside the UK and is endorsed
by Moody's Investors Service Limited, One Canada Square,
Canary Wharf, London E14 5FA under the law applicable to credit
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Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
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for additional regulatory disclosures for each credit rating.
Yasuko Nakamura
VP - Senior Credit Officer
Financial Institutions Group
Moody's France SAS
96 Boulevard Haussmann
Paris 75008
France
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Alain Laurin
Associate Managing Director
Financial Institutions Group
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Releasing Office:
Moody's France SAS
96 Boulevard Haussmann
Paris 75008
France
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
