Moody’s Investors Service has upgraded to Baa1 from Baa2 the long-term foreign currency deposit rating of Greece’s Piraeus Bank SA, concluding a rating review initiated in February 2004. The Prime-2 short-term foreign currency deposit rating and C- financial strength rating remain unchanged. The outlook for all ratings is stable.
According to Moody’s, the rating upgrade reflects the bank’s enhanced business franchise arising from its acquisition of ETVA Bank, as well as its improving financial fundamentals.
Moody’s notes that Piraeus Bank’s earning power and profitability levels improved significantly for FY2003 and for the first quarter of FY2004. Elevated interest income arising from increased lending volumes and higher income from capital market-related activities coupled with low cost growth led to a notable improvement in pre-provision income, while reduced credit costs boosted the bank’s bottom-line profitability.