ANSA Merchant Bank, which has operations in Barbados and Trinidad and Tobago, has been given an ‘AA’ rating by regional ratings agency Caribbean Information and Credit Rating Services Limited (CariCRIS).
The bank, which is part of the ANSA McAL Group based in Port-of-Spain, was given a single notch up, according to CariCRIS, because of the high likelihood of support, “if needed, from the parent company ANSA McAL”.
Noting that the creditworthiness of the bank was high, the agency, which is also based in the twin-island republic, said the ratings were driven by the merchant bank’s favourable market position, its well established brand, and long history in the financial services industry.
Moreover, CariCRIS explained that the ratings were also driven by the ANSA Merchant Bank Group’s favourable market position “supported by a well-established brand and long history in the financial services industry”.
According to a statement from the ratings firm: “There is also a history of strong financial performance and capitalisation levels, as well as good liquidity metrics underpinned by a well-diversified earning asset portfolio with good asset quality. The ANSA Merchant Bank Group’s robust governance structure further supports the ratings.”
At the same time, it was noted that the rating was tempered by the “geographic sovereign concentration risk” which was compounded by global economic uncertainty which could constrain the bank’s financial performance in the year ahead.
Identifying some of the areas that could lead to an improved rating for ANSA Merchant Bank, the agency said these included an improvement in the credit rating of the Government of Trinidad and Tobago, any successful acquisitions over the next 12 to 15 months that provide material improvement in any of the bank’s main segments’ market, and material improvement in the performance of the parent company ANSA McAL Group.
On the flip side, CariCRIS pointed out that the factors which could lead to a downgrade for the bank included a greater than 40 per cent increase in operating expenditure, a downgrade in the rating for the government of Trinidad and Tobago, as well as material deterioration in the financial performance of the parent group.
The bank, which was formed in 1977 is a member of one of the largest conglomerates in the Caribbean. (IMC1)