Bay View Bank Sub Notes Expected `BB' by Fitch IBCA.NEW YORK--(BUSINESS WIRE)--Aug. 6, 1999-- Fitch IBCA IBCA International Braille Chess Association IBCA Institute of Burial and Cremation Administration IBCA Integrated Business Communications Alliance IBCA International Barbeque Cookers Association IBCA Department of Interior Board of Contract Appeals expects to assign its `BB' rating to Bay View Bank's (BVB BVB Basler Verkehrsbetriebe BVB Ballspiel-Verein Borussia 1909 (German soccer club) BVB Belgische Voetbalbond BVB Bundesverband für Buero- und Informationssysteme BVB Boa Vista, Roraima, Brazil (Airport Code) ) proposed $100 million subordinated note issue due 2009. In a related action, Fitch IBCA has lowered its ratings for debt issued or guaranteed by BVB's parent, holding company, Bay View Capital Corporation (BVC BVC Bar Vocational Course (UK) BVC Bolsa de Valores de Colombia (Colombia) BVC Bureau Veritas Certification BVC Banco Venezolano de Credito (Venezuela) ). The rating for BVC's $100 million of 9.125% subordinated notes due August 2007 has been lowered to `B+' from `BB' and the rating for Bay View Capital I, 9.760% capital securities due 2028 issued by a wholly owned, guaranteed subsidiary of BVC has been lowered to `B+' from `BB-'. The RatingAlert Negative placed on both of these outstanding issues on March 12, 1999, has been removed. The rating actions reflect Fitch IBCA's view that the expected acquisition of Franchise Mortgage Acceptance Company (FMAC FMAC Find, Meet, Attract, Close FMAC Financial and Management Accounting Committee FMAC Fédération Mondiale des Anciens Combattants (French: World Veterans Federation) FMAC FEMA Map Assistance Center FMAC FPGA Mission Assurance Center ), while adding business diversity to BVC, will also increase the bank holding company's financial leverage and credit risk profile. In recent years, BVC has evolved its relatively standard thrift balance sheet, with predominately conforming residential mortgages and securities funded by time deposits and wholesale borrowings, into a more diversified depository institution Depository institution A financial institution that obtains its funds mainly through deposits from the public. This includes commercial banks, savings and loan associations, savings banks and credit unions. . As part of the evolution, BVB converted to a national commercial bank charter, effective March 1, 1999. The FMAC transaction is consistent with BVC's strategy to increase its exposure to asset classes that its considers to have higher prospective risk-adjusted returns Risk-Adjusted Return A measure of how much risk a fund or portfolio takes on to earn its returns, usually expressed as a number or a rating. Notes: This is often represented by the Sharpe Ratio. The more return per unit of risk, the better. . Other loan segments that BVC has targeted and become more active originating include indirect auto loans, some of which possess nonprime credit characteristics, along with asset-based commercial transactions. BVC also has a meaningful exposure to high loan-to-value home equity loans. Although the performance of these asset classes has generally been positive for BVC, asset quality has not been tested in a less favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. economic environment. Additional acquisitions of deposit franchises, also consistent with the company's recent operating strategy, would generally be viewed positively, although the financing of such transactions would be scrutinized given what Fitch IBCA considers to be a currently aggressive capital structure at BVC. |
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