Madrid, July 29, 2020 -- Moody's Investors Service has today withdrawn the Baa1/Prime-2
long-term and short-term deposit ratings of Banca IMI S.p.A.
(Banca IMI). At the same time, Moody's has withdrawn:
(1) the bank's Baseline Credit Assessment (BCA) of baa3 and its Adjusted
BCA of baa3; (2) the bank's long-term and short-term
Counterparty Risk Assessment of Baa2(cr)/Prime-2(cr); and
(3) the bank's long-term and short-term Counterparty Risk
Rating (CRR) of Baa1/Prime-2. At the time of withdrawal,
Banca IMI's long-term deposit ratings carried a stable outlook.
The withdrawal of Banca IMI´s BCA and adjusted BCA, and of
its deposit and CRR ratings reflects the merger by absorption of Banca
IMI into its parent Intesa Sanpaolo S.p.A. (Intesa
Sanpaolo; Baa1 stable/Baa1 negative, baa3), following
which Banca IMI ceased to exist as separate legal entity.
In addition, the ratings on the senior unsecured debt instruments
issued by Banca IMI and now transferred to Intesa Sanpaolo, were
affirmed at Baa1 with a negative outlook.
A full list of affected ratings can be found at the end of this press
release.
RATINGS RATIONALE
The rating action reflects the completion of the merger by incorporation
of Intesa Sanpaolo and its domestic subsidiary Banca IMI, which
was approved on 10 April 2020 by the banks' board of directors.
The merger became effective on 20 July 2020, after Banca IMI transferred
all of its assets and liabilities to Intesa Sanpaolo. Prior to
this action, the ratings of Banca IMI were already aligned with
those of Intesa Sanpaolo, reflecting Moody's views of Banca IMI's
high integration with its parent and the group's plan to merge the two
entities.
Moody's has withdrawn these ratings for reorganisation reasons.
Please refer to the Moody's Investors Service's Policy for Withdrawal
of Credit Ratings, available on its website, www.moodys.com.
AFFIRMATION OF SENIOR UNSECURED DEBT RATINGS
Moody's affirmation of Banca IMI's long-term senior unsecured debt
rating at Baa1 with a negative outlook takes into account the merger by
absorption of the bank with its parent Intesa Sanpaolo. Given that
Intesa Sanpaolo has assumed all of its subsidiary's financial obligations,
Moody's has maintained these senior unsecured debt ratings aligned with
those of Intesa Sanpaolo.
The negative outlook on Intesa Sanpaolo's long-term senior unsecured
debt rating reflects the downward pressure on the bank's BCA and the potential
for a reversal of its previously improving trend in asset quality amid
Italy's deteriorating operating environment due to the coronavirus
outbreak.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade of Intesa Sanpaolo's senior debt ratings is very unlikely
given the current negative outlook. An upgrade of Intesa Sanpaolo's
BCA is also very unlikely as long as the Italian government's bond rating
remains at Baa3. A bank's BCA would not typically exceed the sovereign
rating under our methodology unless the interdependence between the creditworthiness
of the bank and that of the sovereign is limited.
Intesa Sanpaolo's BCA could be downgraded if a deeper and more prolonged
recession were to result in a large increase in problem loans and much
weaker profitability. A lower BCA would lead to lower senior unsecured
debt ratings. The bank's senior unsecured debt ratings could be
downgraded if it reduces the buffer of bail-in-able debt
issued by itself or its guaranteed funding vehicles.
LIST OF AFFECTED RATINGS
Issuer: Banca IMI S.p.A.
..Affirmations and subsequent transfer to Intesa Sanpaolo
S.p.A.:
....Senior Unsecured Regular Bond/Debenture,
affirmed Baa1 , outlook remains Negative
..Withdrawals:
....Long-term Counterparty Risk Ratings,
previously rated Baa1
....Short-term Counterparty Risk Ratings,
previously rated P-2
....Long-term Bank Deposits,
previously rated Baa1, outlook changed to Rating Withdrawn from
Stable
....Short-term Bank Deposits,
previously rated P-2
....Long-term Counterparty Risk Assessment,
previously rated Baa2(cr)
....Short-term Counterparty Risk Assessment,
previously rated P-2(cr)
....Baseline Credit Assessment, previously
rated baa3
....Adjusted Baseline Credit Assessment,
previously rated baa3
..Outlook Action:
....Outlook changed to Rating Withdrawn from
Stable(m)
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Banks Methodology
published in November 2019 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1147865.
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
agent(s) and issued with no amendment resulting from that disclosure.
These ratings are solicited. Please refer to Moody's Policy
for Designating and Assigning Unsolicited Credit Ratings available on
its website www.moodys.com.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
Moody's general principles for assessing environmental, social
and governance (ESG) risks in our credit analysis can be found at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1133569.
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.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Maria Jose Mori
VP - Senior Credit Officer
Financial Institutions Group
Moody's Investors Service Espana, S.A.
Calle Principe de Vergara, 131, 6 Planta
Madrid 28002
Spain
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Nicholas Hill
MD - Banking
Financial Institutions Group
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Releasing Office:
Moody's Investors Service Espana, S.A.
Calle Principe de Vergara, 131, 6 Planta
Madrid 28002
Spain
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
