Frankfurt am Main - Moody's has today upgraded by two notches the long-term ratings of Norddeutsche Landesbank GZ, NordLB, and its rated subsidiaries. Specifically, NordLB's long-term senior unsecured debt and deposit ratings were upgraded to A3 from Baa2, the outlook changed to stable from ratings under review.
Moody's also upgraded NordLB's Baseline Credit Assessment (BCA) to ba3 from b2. Further, Moody's has affirmed the P-2 short-term ratings of NordLB and its rated subsidiaries, as applicable, and downgraded NordLB's hybrid securities which are issued through the funding vehicles Fuerstenberg Capital Erste GmbH and Fuerstenberg Capital II GmbH, to Caa3 from Caa1.
The rating actions follow NordLB's announcement on 23 December 2019, stating that the capital strengthening of combined €3.6 billion from its public sector owners was successfully completed. By the end of december, NordLB had received the hoped for capital injection from its shareholders. "Our owners have made great efforts to make the reorientation of NordLB possible," said Thomas Bürkle, chair of the managing board. "We will now continue the course of transformation we are currently on consistently so as to fulfil the expectations placed upon us. The new NordLB will build on old strengths but will be significantly more efficient and more resistant to crises. We will still have to overcome major challenges on our way to becoming a sustainably profitable bank.”
Before the 2008 financial crisis NordLB was one of the five German banks with the closest links to the shipping industry and Germany was one of the world’s main centres of global ship financing. As well as peers such as HSH, Commerzbank , DVB and KfW, the bank has taken large writedowns and boosted capital buffers against the risk of shipping loans turning sour.