(The following statement was released by the rating agency)
Oct 02 - Fitch Ratings is maintaining Indonesia-based Bank Danamon's ratings, including its Long-Term Issuer Default Rating (IDR) of 'BB+' and its National Long-Term Rating of 'AA+(idn)', on Rating Watch Positive (RWP). A full rating breakdown is provided below.
The RWP is pending the proposed acquisition of Temasek Holdings' (Temasek) 67.4% stake in Danamon by DBS Group Holdings (DBSGH). The consummation of the takeover - which has been delayed to accommodate the introduction of the bank ownership rule in Indonesia - is still subject to regulatory approval, and hence may take longer than three months. Fitch expects to resolve the RWP once there is greater clarity on the outcome and once the agency has assessed the potential extraordinary support that DBSGH could provide to Bank Danamon.
Should the proposed acquisition be unsuccessful, Fitch is likely to affirm the ratings and assign a Stable Outlook, given Bank Danamon's high capitalisation, moderate earnings, and modest non-performing loans amid an uncertain global economic environment.
In April 2012, Fitch placed Bank Danamon on RWP to reflect the positive impact on the bank's risk profile from the proposed takeover by DBSGH, which has a stronger credit standing.
Danamon's full list of rating actions: - Long-Term IDR of 'BB+' remains on RWP - Short-Term IDR of 'B' remains on RWP - National Long-Term Rating of 'AA+(idn)' remains on RWP - Support Rating of '3' remains on RWP - Viability Rating affirmed at 'bb+'