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S&P lifts Big 4 credit ratings

S&P lifts Big 4 credit ratings

(23 February 2007 – Australia) Ratings agency Standard & Poor's has lifted its long-term credit ratings of Australia’s Big Four banks to 'AA' from 'AA-'. S&P said it had also removed Commonwealth Bank, ANZ, National Australia Bank and Westpac from "CreditWatch with positive implications" where the banks were placed last November.

'A common theme across the major Australian banks is the progressive structural strengthening of financial profiles, as well as continued development of their risk-management capabilities,' S&P Financial Services credit analyst Craig Bennett said.

S&P also raised the fundamental strength ratings of the four banks to 'A' from 'B+', while their short-term ratings were affirmed at 'A-1+'.

The ratings agency said the underlying strength in earnings reflected the banks' very good asset quality, strong operational efficiency, and sound and emerging product diversity.

'Compared with their global peers, the major Australian banks are reliant on a few geographic markets, which lessens their ability to withstand shocks,' Bennett said.
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