THOMSON BANKWATCH RATINGS: CREDIT LYONNAIS (PARIS, FRANCE) SENIOR DEBT ASSIGNED 'A'
NEW YORK, Aug. 3 /PRNewswire/ -- Thomson BankWatch, Inc., today announced the following: Effective immediately, BankWatch has assigned a Senior Long -Term Rating of A to the US$ 1.25 billion debt issue (maturity 7/28/98) of Credit Lyonnais. This rating reflects the overall soundness of the institution, as well as the ownership and support of the French government. Credit Lyonnais has built a global franchise, which includes a retail presence in the important European markets, most recently expanded by the acquisition of the German bank, BFG Bank. The rating also incorporates our concern over asset quality and profitability for the consolidated institution based upon the expectation of continued high provisions through 1993. Credit Lyonnais reported a net loss, excluding minority interests, of FF1.85 billion for 1992, reflecting net provisions of FF14.7 billion. We anticipate high provisions for Credit Lyonnais will be required through 1993 and into 1994 to continue to address problems in the stagnant French economy, the lackluster property market in Paris, as well as a large exposure in the U.S. film industry. We anticipate that the bank will report a loss for 1993, which may be less than that posted in 1992, depending on the lower interest rate environment during the remainder of the year, as well as realized gains on sales of assets. Management of Credit Lyonnais is currently focusing on improving its control on credit quality, as well as significantly curtailing expense growth. When the economic environment in France and Europe improves, which is anticipated during 1994, the banks' earnings generation should benefit from the measures being implemented. The total risk-weighted capital ratio of Credit Lyonnais, which was 8.2 percent at year end 1992, will benefit from a recently completed U.S.$350 million preferred share issue, tempering the impact on capital of the loss anticipated for the first six months 1993. Although the French government has announced that it will privatize a number of state institutions, we do not anticipate that the privatization of Credit Lyonnais will occur for at least two years. Founded in 1974 and widely considered the industry standard for bank ratings, Thomson BankWatch monitors more than 400 banks, thrifts and securities firms, providing the world's largest financial institutions, money managers, corporations, and government regulators with vital information on credit risk. NOTE: This communication is not an offer to sell or a solicitation of an offer to buy the securities mentioned. The information contained herein is derived from publicly available sources and Thomson BankWatch, Inc. makes no representation as to the accuracy or completeness of such information. -0- 8/3/93 /CONTACT: Virginia Stirling, 212-510-0318, or Dianne Del Bello (marketing), 212-510-0309, both of Thomson BankWatch/ (CRLP)
CO: Credit Lyonnais ST: IN: FIN SU: RTG
SH -- NY024 -- 8777 08/03/93 09:51 EDT
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|Date:||Aug 3, 1993|
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