Moody’s Investor Service on January 29 downgraded its rating on OTP Bank’s Upper Tier 2 perpetual subordinated bond issue to Ba1 with a negative outlook from Baa2 pursuant to the financial service’s revised Guidelines for Rating Bank Hybrids and Subordinated Debt published in November 2009, OTP announced on the website of the Budapest Stock Exchange on Tuesday.
Dow Jones reported on Friday that prior to the global financial crisis, Moody’s had incorporated into its ratings an assumption that support provided by national governments and central banks to shore up a troubled bank would, to some extent, benefit the subordinated debt holders as well as the senior creditors. The systemic support for these instruments has not been forthcoming in many cases. The revised methodology largely removes previous assumptions of systemic support, resulting in the January 29 rating action. In addition, the revised methodology generally widens the notching on a hybrid’s rating that is based on the instrument’s features.
Moody’s did not change any other ratings on OTP Bank.
WTF does this mean for us OTP-customers ?
Should I go to another bank – I think they’re all vultures …
I don’t think it means *anything*. Bank is safe, if only because the gov’t would never let it fail – as long as it’s in “Hungarian” hands.
At one stage it was revealed that OTP made a
profit in every country where it has branches
except Hungary.
For day-to-day banking (retail customers) I use
K&H Bank and, I am quite pleased with the service.
This doesn’t mean that I haven’t had show-downs with them over the last couple of years. But, to their credit they have always listened and, in the main,put things right.
I opted for the “electronic package” which can save you a lot in charges over the year.
I was unhappy with OTP and changed banks. I am glad I did. I restrained myself from using foul language to describe my bumpy ride with OTP.
I think George Soros shafted them (OTP) but can’t be certain of the events.
PS
What the main article is about I will never know. (Nor want to.)
MinitheMidget. Have you had a sex change, Benny?
We have missed you. Where have you been?
Or, perhaps, Mini is your new wife?
@törpe:
Shouldn’t it read “obfuscated” ?
Wolfi, I might be able to answer that except my post
has apparently been removed. By the moderators? That
would be quite odd considering some of the ranting
that is published on this and sister-sites.
Spotty, indeed Minnie = Benny, and our split
personality is lurking behind a shower curtain in a
motel somewhere.
Gotcha, Miniben. I’m inclined to be a bit schizophrenic myself. So watch out from behind that shower curtain now I know where you are hiding.
BTW. What moderators? Do you mean Erik?
Try re-writing the “removed post” in a way that
might prove less controversial. If indeed that is what it is.
Lots of strange things happening everywhere at the moment. Ghosts in the machine. And, where is my second best friend after Farkas László, JD?
Yes, moderators = Erik, I presume.
I simply wrote that this article was a role model of
obtuseness (obfuscation is a better term), probably
generated by a jargon generator.
I can only assume the post was deleted by accident
somehow.