Moody’s changes UniCredit Bank Austria view

Moody's Investors Service said it affirmed the senior unsecured debt and deposit ratings of UniCredit Bank Austria AG at Baa1 and its backed senior unsecured ratings, guaranteed by the city of Vienna, at A2.

The outlooks on the backed and unbacked senior unsecured debt ratings were changed to developing from stable, and the outlook on the deposit ratings were changed to positive from stable.

Moody's also affirmed the P-2 short-term deposit ratings, the provisional Ba1 subordinated program rating, the Baa2 backed subordinated debt rating, various hybrid instrument ratings issued by supported entities, the baa3 baseline credit assessment, the baa3 adjusted baseline credit assessment and the A3(cr)/P-2(cr) counterparty risk assessment of UniCredit Bank Austria.

Moody’s said the action was prompted by two factors, specifically: (a) Moody's assessment of the bank’s improved financial strength and the resulting scope for a higher BCA which, however, remains constraint to a level one notch above the ba1 BCA of its parent bank, UniCredit SpA (deposits Baa1 positive, senior unsecured debt Baa1 positive, BCA ba1); and (b) a lower result for UniCredit Bank Austria’s senior debt ratings from Moody's Advanced Loss Given Failure analysis, following changes in the bank's liability structure as of December 2017, coupled with uncertainty of the bank's future issuing activity with respect to senior unsecured and subordinated debt instruments.

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