Moody's revises rating outlook for Bank of Singapore to negative

Credit ratings agency Moody's Investors Service has revised the rating outlook on Singapore's largest bank, the Bank of Singapore Limited (BOS), to negative from stable on Thursday.

At the same time, Moody's has affirmed the bank's local and foreign currency deposit ratings, and its local and foreign currency issuer rating of Aa1/P-1.

The change in the rating outlook to negative from stable for BOS reflects a similar change in the rating outlook on its parent bank OCBC. In turn, the negative outlook on OCBC is driven by Moody's expectations of a more challenging operating environment for banks in Singapore, according to the agency.

BOS's ratings could be downgraded if OCBC's aa3 adjusted BCA (baseline credit assessment) is lowered. In addition, BOS's ratings could also be downgraded if the bank's fundamentals weaken, as evidenced by a more challenging operating environment and/or deteriorating financial metrics, it added.

In view of the negative outlook on the ratings, Moody's said it does not expect any upward pressure on BOS's ratings.

The outlook on the bank's ratings could be revised to stable from negative if macroeconomic conditions in Singapore and in the region improve and the outlook on OCBC is revised back to stable, Moody's said. Enditem