Standard & Poor's says bank issuance of high yielding hybrid securities weakens their capital and earnings quality

By Gareth Vaughan

Issuance of hybrid securities such as ones issued by ASB and Kiwibank this year weaken banks' quality of capital and earnings, credit rating agency Standard & Poor's says, and can be a factor in credit rating downgrades.

S&P makes this point in a report on the world's top 100 rated banks. The report includes the Australian parents of New Zealand's big four banks within the world's top 50 rated banks. ASB's parent Commonwealth Bank of Australia comes in 40th, BNZ's parent National Australia Bank places 41st, ANZ is ranked 46th, and Westpac 49th.

This is an abridged version of this article. The full version was published in our email for paying subscribers. See here for more details and how to subscribe.