Bendigo and Adelaide Bank joins banking's 'A' team
Bendigo and Adelaide Bank (BEN) last night joined the ranks of Australia's A-rated banks following an upgrade announced by Standard & Poor's (S&P).
S&P's decision to raise the bank's long-term rating from BBB+ to A– means the bank is now rated 'A' by all three of the world's leading credit rating agencies.
Moody's 'A' rating predates the merger of Bendigo and Adelaide banks. Fitch upgraded the bank in May 2011. The S&P upgrade has also been applied to BEN's wholly owned subsidiary Rural Bank, which gains an 'A- rating with a stable outlook.
In welcoming S&P's announcement, BEN's managing director Mike Hirst noted that few banks in the world were being upgraded in the current difficult economic environment.
"That brings added lustre to our achievement, but it sounds a note of caution at the same time.
"We are obviously pleased to deliver on our stated aim to achieve an A rating from all credit agencies, but we are under no illusions about just how tough the economic environment is.
"Maintaining our hard-won position will require continued focus."
Mr Hirst said BEN had identified two years ago the need to achieve an A rating in order to open up new funding markets.
"Funding is obviously challenging all banks globally, but the upgrade will certainly enable us to access funding otherwise denied to us. Importantly, it will also enable us to service supporters who were precluded from banking with us because we were not A rated.
"One thing it will not do, though, is change our fundamental approach to risk and management. Retail funding remains our key focus because of the strong relationships it brings with our customers, partners and communities. Their support and advocacy is a key to our continued success."
Bendigo and Adelaide Bank has 1.4 million customers and more than $50 billion in assets held by its diversified businesses.
Its retail arm, Bendigo Bank, operates throughout Australia in almost 600 outlets, including 286 Community Bank® branches owned and operated by local communities.
Adelaide Bank is a specialist provider of third party mortgages and investments, Bendigo Wealth delivers managed funds, superannuation and other financial services to retail customers and advisers, Leveraged Equities is one of Australia's largest margin lenders and Rural Bank provides agribusiness and retail banking to rural and regional Australians.