|        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Thursday, April 2nd, 10:34PM


Latest Headlines

TSB gets a ratings upgrade

TSB Bank has had its credit rating upgraded on the back of "very-good asset quality and profitability".

Wednesday, March 19th 2008, 9:16PM
Standard & Poor's has raised the bank's long-term rating from BBB to BBB+. Besides asset quality and profitability S&P says TSB has "above-peer capitalisation and liquidity, and a solid regional franchise."

"Due to its predominately prime-residential mortgage-based book, TSB's loan-book track record is excellent, which has resulted in very low non-performing assets and charge-offs over the past five years," Standard & Poor's credit analyst Shaun Evans said. "However, the bank has limited business diversity, its funding is concentrated, and its risk-management capabilities are still developing."

Earnings have been resilient, benefiting from the higher-than-peers interest margin and good cost efficiency. The bank's low-cost retail funding base underpins its robust net interest margin. The net interest margin for the six months to Sept. 30, 2007 was 2.98%, which compares well with domestic peers, considering TSB's low-risk asset profile. TSB's cost-to-income ratio is very good, and continued to steadily improve over recent years.

Liquidity levels are high and above the peer average. The bank has consistently held more than 30% of its assets in cash and marketable securities, which provides ample liquidity under normal operating conditions and offsets concerns to an extent associated with the short-dated nature of its liability profile. The retail funding capabilities are augmented by TSB's two committed wholesale bank lines from AA rated banks, which provide a moderate level of additional funding support.

The stable outlook on TSB is based on our expectation that the bank will continue to focus on key financial-strength drivers that have contributed to positive ratings momentum in recent times, Evans says.

« No tax write-offs for investorsYour guide to bank bond offers »

Special Offers

Commenting is closed



Printable version  


Email to a friend
Today's Best Bank Rates
Rabobank 1.75  
Based on a $50,000 deposit
More Rates »
News Bites
Latest Comments
  • Advisers 'will drop out'
    “@gavin austin - actually our focus is on getting Advisers to ask their existing customers "What can we do to help you?"...”
    10 hours ago by Andrew Scott GM Newpark
  • Advisers 'will drop out'
    “Interesting comments Andrew. I take it from your comment about Dgs being worth their salt that you've provided your members...”
    12 hours ago by gavin austin adviser business compliance
  • AML flexibility offered
    “AML flexibility is great and well received. What are the law society and the JP organisation doing to find ways to reduce...”
    13 hours ago by Tony Walker
  • Advisers 'will drop out'
    “@Fred Dodds - with respect, focusing on your Level 5 qualification, or for that matter your transitional FAP licence, is...”
    16 hours ago by Andrew Scott GM Newpark
  • Covid withdrawals possible 'but not always desirable'
    “Very few of us have any idea what facing homelessness and potentially starvation (literally and figuratively) is like. As...”
    16 hours ago by Chris Hardcastle
Subscribe Now

Deposit Rates newsletter

Previous News


Most Commented On
News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%


About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
Site by Web Developer and