Bangkok--7 Dec--Fitch Ratings
Fitch Ratings has upgraded the National Long-Term Rating of Capital Nomura Securities Public Company Limited (CNS) to 'AA(tha)' from 'AA-(tha)'. The Rating Outlook is Stable. A full list of rating actions is at the end of this commentary.
The upgrade follows Fitch's assessment that there has been an improvement in the credit profile of CNS' parent Nomura Holdings, Inc. (A-/Stable/bbb+) relative to other entities on the Thai National Ratings scale, which has enhanced its ability to provide support to its Thai subsidiary (see also Fitch Affirms Nomura and Daiwa; Upgrades VR of Nomura Holdings, published 25 October 2017).
KEY RATING DRIVERS
CNS's National Long-Term Rating reflects Fitch's view of its strategic importance to Nomura Holdings. This is due to the majority shareholding by the parent, high levels of management control and integration, name- and brand-sharing, and history of financial support from Nomura Holdings. CNS has a well-established franchise and a relatively diverse client base in the Thai securities industry. It has been consistently profitable, posting net income of THB388 million in 9M17, up from THB293 million a year earlier.
RATING SENSITIVITIES
CNS's ratings could be impacted by any changes in Fitch's view on the parent's propensity to provide extraordinary support. For example, this may be indicated by significant changes in shareholding or in the level of control Nomura Holdings has in CNS. However, Fitch does not expect any of such changes to affect Nomura Holdings' propensity to support CNS in the near term.
CNS's ratings would also be affected by further changes in Nomura Holdings' credit profile.
The rating actions are as follows:
- National Long-Term Rating upgraded to 'AA(tha)' from 'AA-(tha)'; Outlook Stable
- National Short-Term Rating affirmed at 'F1+(tha)'
- National Short-Term Rating on unsecured unsubordinated debenture programme affirmed at 'F1+(tha)'