S&P Assgns AA-/A-1+ Ratings to Standard Life Bank Ltd 08-18 10:04.LONDON--(BUSINESS WIRE)--Aug. 18, 1999-- Standard & Poor's today assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. its double-'A'-minus long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. and 'A-1'-plus short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. counterparty Counterparty The other participant, including intermediaries, in a swap or contract. credit and certificate of deposit ratings to Standard Life Bank Ltd. (Standard Life Bank), a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of The Standard Life Assurance Co. (Standard Life; triple-'A'/Stable/--). The outlook is stable. The ratings on Standard Life Bank reflect its standing within the Standard Life Assurance group, the start-up Start-up The earliest stage of a new business venture. nature of its business, and its emerging position within the U.K. savings and residential mortgage market. The bank is an important element in the strategy of its parent to offer a more comprehensive range of financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. to its clients. Standard Life is the largest mutual life insurance company in Europe, with extremely strong capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. , an excellent market position, very strong operating performance, and accomplished service standards. The bank gains both tangible and intangible benefits from its position within the Standard Life group. Standard & Poor's believes that there is a strong likelihood that Standard Life will provide tangible support to the bank, because of the closeness in reputation and brand of the life company and the bank, the overlap in the client base, the importance of the Independent Financial Advisor (IFA Immunofluorescent assay (IFA) A blood test sometimes used to confirm ELISA results instead of using the Western blotting. In an IFA test, HIV antigen is mixed with a fluorescent compound and then with a sample of the patient's blood. ) market to Standard Life's franchise, and managerial links between the two companies. While Standard Life does not guarantee the obligations of the bank, it has provided Standard Life Bank's regulator--the U.K. Financial Services Authority--with a letter of comfort regarding its responsibilities in respect of Standard Life Bank. Although such a comfort letter is not legally enforceable, it does underline underline an animal's ventral profile; the shape of the belly when viewed from the side, e.g. pendulous, pot-belly, tucked up, gaunt. the strong likelihood that Standard Life would provide tangible financial support to the bank should the need arise. Standard Life Bank is a U.K. bank offering savings and retail mortgage products. It has no branch network and provides all its services via telephone. Standard Life Bank generates a significant amount of its business from IFAs, who contact the bank on behalf of their clients. The bank also deals directly with personal customers. While Standard Life Bank is still in a start-up phase, it has gained a visible market presence through a combination of advertising, pricing policy, and product design. Standard Life Bank was incorporated in April 1997 and received its banking license in December of that year. Standard Life Bank launched savings deposit products in January 1998. By the end of July 1999, it had raised over UK3.2 billion (about $5.1 billion at $1.595 to UK1) in deposits from more than 223,000 customers. Standard Life Bank offers a simple and focused range of deposit products to personal and business customers. It does not offer current accounts or automatic teller machine See ATM. (ATM) facilities. Although Standard Life Bank only began offering mortgage loans in January 1999, it had accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. over 23,600 mortgage customers by the end of July 1999, and has completed UK1.8 billion in home loans in this period. This gives it an estimated 9% of U.K. net mortgage lending in the first half of 1999. The bank also has a significant amount of mortgages in application and processing stages. In line with its strategy of offering a simple product range, Standard Life Bank currently offers one mortgage product--a variable-rate flexible mortgage. Flexible mortgages are becoming more popular in the U.K. Subject to conditions, customers can choose the duration of the mortgage, can make early payments against the mortgage, and can arrange to make drawdowns against the equity in their property. The majority of Standard Life Bank's business comes from customers switching their mortgages from other providers. While this may have a positive effect on asset quality, such customers may have a high propensity to switch provider again. The quality of the loan book is good, but Standard Life Bank has not yet built a record of managing asset quality. The bank's capitalization is adequate. OUTLOOK: STABLE The outlook reflects that of its parent. Standard & Poor's expects that Standard Life will continue to exhibit excellent levels of capitalization and uphold up·hold tr.v. up·held , up·hold·ing, up·holds 1. To hold aloft; raise: upheld the banner proudly. 2. To prevent from falling or sinking; support. 3. its strong franchise in the long-term savings and investments market. Standard Life Bank has achieved a visible market presence in a short period of time. A key issue in the overall assessment of the bank will be its ability to maintain and build on this presence. While Standard Life Bank does not offer the most attractive lending and deposit rates on the market, it does offer very competitive rates. The bank's depositors may be more price sensitive than the market average, although Standard Life Bank hopes to generate loyalty by fair pricing, service, and product features. Standard Life Bank also trusts that its flexible product features will prevent customers from switching provider, Standard & Poor's said. -- CreditWire |
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