Bangkok--7 Nov--Fitch Ratings
Fitch Ratings has affirmed the National Long-Term Rating of Government Housing Bank (GH BANK) at 'AAA(tha)' with Stable Outlook. The National Short-Term Rating has also been affirmed at 'F1+(tha)'.
KEY RATING DRIVERS
GH BANK's National Rating reflects Fitch's belief of a high probability of state support for the bank, if needed. This is based on its status as a state policy bank set up under specific legislation to fulfil government objectives, close state linkages, full direct ownership and control by the Ministry of Finance (MOF), and a consistent track record of financial support (including deficiency guarantees and potential for debt to be guaranteed by the MOF). GHB has consistently maintained its key policy role of making home loans more accessible to people in the low and middle-income demographic who may not qualify for credit from commercial banks.
Fitch expects timely support to be given to the bank if needed, but GH BANK's earnings performance over the past several years has been sound and hence extraordinary capital support has not been required.
The Stable Outlook reflects Fitch's expectations that the government's propensity to support the bank is unlikely to reduce in the medium term.
RATING SENSITIVITIES
There is no upside to the National Ratings of GH BANK as the ratings are already at the highest level on the scale. Any perceived weakening in the sovereign's propensity to support GH BANK, for example if the bank's legal status as a state policy bank changes or if the government's ownership reduces, may result in a downgrade of its National Ratings. However, Fitch deems such events to be unlikely in the medium term.
Additional information is available on www.fitchratings.com