Clausole di loss absorption in opera su due perpetuals emessi da veicoli societari di Dresdner Bank e pioggia di downgrades su perpetual correlati a Dresdner Bank, Commerzbank ed Eurohypo, oltre che su di un UT2 emesso da un altro veicolo societario di Dresdner.
Per il rating degli emittenti e dei bond senior, il supporto statale determina un rating groundfloor, per cui esso rimane invariato.
Su questi strumenti secondo S&P è molto accresciuto il rischio di deferral delle cedole da parte di Commerzbank e delle altre entità del gruppo, vuoi spontaneo, in occasione della cancellazione di ogni dividendo, vuoi forzosamente determinato dal Governo tedesco.
Two Dresdner Bank Hybrid Capital Instruments Cut To 'CC', Other Commerzbank Group Hybrids Cut To 'BB'; Still On WatchNeg
FRANKFURT (Standard & Poor's) Feb. 27, 2009--Standard & Poor's Ratings
Services said today it lowered its ratings on Dresdner Bank AG's €1 billion
hybrid Tier 1 capital instruments issued through HT1 Funding GmbH and on the bank's €750 million upper Tier 2 capital instruments issued through UT2 Funding PLC to 'CC' from 'BB+'.
At the same time, we lowered the ratings on Dresdner Bank's hybrid Tier 1 capital instruments issued through Dresdner Funding Trust I, II, III, and IV, and on various other junior subordinated Tier 1 instruments related to Commerzbank AG (A/Stable/A-1) and its subsidiary Eurohypo AG (A/Negative/A-1) to 'BB' from 'BB+'.
All these issue ratings remain on CreditWatch, where they were placed with negative implications on Jan. 12, 2009.
The rating actions follow yesterday's announcement by Dresdner Bank that, according to preliminary results, a larger than expected fourth-quarter loss has resulted in a net accumulated loss ("balance-sheet loss") at Dresdner Bank AG (unconsolidated accounts) in 2008, even after the reversal of all reserves, and that regulatory capital levels have dropped close to minimum requirements.
Dresdner Bank also stated that this would lead to loss participation on the part of outstanding hybrid capital and profit participation certificates.
The 'A' long-term and 'A-1' short-term counterparty credit ratings on
Commerzbank, Dresdner Bank, and Eurohypo (combined group) were affirmed, based on our view of the external support from the government of the Federal Republic of Germany (AAA/Stable/A-1+).
The affirmation reflects that we consider Commerzbank a government-related entity (GRE), based on our expectation of future and existing government support measures. Commerzbank announced that despite the
loss at Dresdner Bank, the combined group's regulatory Tier 1 capital ratio
remains unchanged at about 10% (calculated as of Jan. 1, 2009), following the takeover of Dresdner Bank that closed in January 2009.
"The combined group's stand-alone credit profile remains under review, but we believe that it has further weakened and is now at least two notches below the issuer credit rating on Commerzbank," said Standard & Poor's credit analyst Bernd Ackermann.
This action also takes into account the weak performance of Dresdner Bank and the rapidly changing economic environment, which in our view has placed pressure on the enlarged Commerzbank's financial profile. We will review the stand-alone credit profile when more information on the combined group's financial profile and the implications for its business plans becomes available.
"The downgrade and CreditWatch with negative implications on HT1 Funding GmbH and UT2 Funding PLC reflects that we believe that there is now a very high likelihood that the instruments might defer payments on the next coupon payment date on June 30, 2009, and that the face value on the instruments might at least temporarily be reduced as a result of the balance-sheet loss," said Mr. Ackermann. In this case, we would likely lower the ratings to 'C'.
In the case of HT1 Funding GmbH, the terms of the instruments state that Dresdner Bank's former owner, Allianz SE (AA/Stable/A-1+), would make coupon payments instead of Dresdner Bank, according to the terms of a contingent indemnity agreement (CIA), but the interest rate would be paid on the instruments' reduced book value as shown in Dresdner Bank's unconsolidated accounts.
The downgrade on notes issued by Dresdner Funding Trust I, II, III, and
IV and other hybrid capital instruments of the Commerzbank group reflects our view that the Commerzbank group's stand-alone credit profile has weakened. In addition, to some degree, investors in these notes also rely on the willingness of Commerzbank to make payments.
With the recent publication of its preliminary 2008 results, Commerzbank has declared that it would pay coupons on Commerzbank and Eurohypo hybrid capital instruments. However, the payment deferral on HT1 Funding GmbH and UT2 Funding PLC could indicate that the Commerzbank group might be more likely to use any deferral option.
The ratings on these issues also reflect our view of the likelihood that
the current and projected difficult operating environment and the Dresdner Bank merger will result in significant bottom-line losses for the enlarged
Commerzbank in 2009, and that the Commerzbank group relies on the government for capital support.
This increases the potential, in our view, that in the short to medium term, Commerzbank, through its own initiative or under the government's instructions, will defer coupon or dividend payments to preserve cash and capital, unless it is contractually obliged to make a payment. Moreover, European Community law regarding state aid may, in our view, contribute to heightened payment deferrals on hybrid capital securities of financial institutions.
These instruments remain on CreditWatch with negative implications, where they were placed on Jan. 12, 2009. The CreditWatch status reflects our view of the uncertainty regarding the degree of earnings deterioration and potential restructuring plans and their collective impact on the medium-term earnings outlook and capital of the combined group.
"The CreditWatch also reflects the potential limitations on the combined
group's flexibility to meet coupon payments, which might emerge as a result of state-aid investigations," said Mr. Ackermann.
We expect to resolve the CreditWatch status on the hybrid issues over the next 90 days after further meetings with Commerzbank to discuss their earnings prospects, capital plans, and the resolution of state-aid approval.
