Moody’s Investors Service has assigned (P)Baa2 long-term and (P)Prime-2 short-term foreign currency senior unsecured ratings to Security Bank Corporation’s (Baa2 stable, baa3) $1 billion medium term note (MTN) program.
Security Bank’s (P)Baa2/(P)P-2 foreign currency senior unsecured MTN program ratings are in line with the bank’s Baa2/P-2 foreign currency deposit and issuer ratings.
The notes constitute direct, unconditional, unsubordinated, and unsecured obligations and will rank pari-passu with the bank’s other senior unsecured obligations.
The ratings do not apply to individual notes issued under the program. Ratings on individual notes issued under the program will be subject to Moody’s satisfactory review of the terms and conditions in the final base and supplementary offering circular and the pricing supplements of the notes to be issued.
These are underpinned by Security Bank’s baa3 baseline credit assessment (BCA) and incorporates one notch of uplift to reflect Moody’s expectation of a moderate probability of support for the bank from the government (Baa2 stable) in times of need.
The bank’s baa3 BCA is underpinned by its above-industry-average asset quality and strong capital buffers, boosted by a capital infusion from its new strategic partner, MUFG Bank, Ltd. (MUFG, A1 stable, a3). At the same time, the BCA takes into account expectation that following the capital infusion, the bank’s asset quality and capital profile will moderate over time because of higher-than-industry growth plans.