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Monday, February 28, 2011

Fitch upgraded 7 bank outlook

Irvin Avriano A.

Fitch upgraded 7 bank outlook

JAKARTA: PT Fitch Ratings Indonesia upgraded seven local bank rating outlook from stable level to positive level, following the same upgraded BB+ rating outlook for Indonesia sovereign last week.

The announcement published in a press release today. The banks are PT Bank Mandiri Tbk (Mandiri), PT Bank Rakyat Indonesia Tbk (BRI), PT Bank Negara Indonesia Tbk (BNI), PT Bank Central Asia Tbk (BCA), PT Bank CIMB Niaga Tbk (CIMB Niaga), PT Bank OCBC NISP Tbk (OCBC NISP), and PT Bank Internasional Indonesia Tbk (BII).

The agency also revised the support rating floor for Mandiri, BRI, and BNI to BB+ from BB.

The rating action also underlined the support from goverment especially to state owned enterprise (SOE) Bank Mandiri, BRI and BNI, reflected on their support rating of '3' level due to their systemic importance to the Indonesian economy.

The action also describe the government ownership status, that makes Fitch expects the government's ability to provide support, if needed, will improve gradually.

Fitch also assess the other public banks outlook at positive level reflect the positive economic improvement in Indonesia.

BCA's positive outlook also reflects Fitch's expectations that the bank's performance are strong and will likely benefit from the improved economic conditions in Indonesia. The agency also recorded BCA's consistently above-average financial performance, even during the economic downturn in 2008--2009.

CIMB Niaga, OCBC NISP, and BII rating outlook reflects Fitch's expectation that the banks will be upgraded in the event of a national rating upgrade, related to their parent companies' rating that higher than the Indonesia sovereign rating.



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