...High Ratings: U.S. trust and processing banks rank among Fitch Ratings' most highly rated entities globally. Their ratings were affirmed in July 2017, driven by solid company profiles, including high barriers to entry, good capital ratios in context of lower risk balance sheets, strong liquidity position and improving earnings performance. Rating Sensitivities: The banks' credit strengths continue to be counterbalanced by Fitch's view of elevated operational risk (inclusive of cyber security risks) present in the business model that has the potential to negatively impact the franchise should it result in client losses. Fitch would likely review the ratings of a company should an operational loss amount to 5% or more of its revenue. High Barriers to Entry: U.S. trust and processing banks have strong franchises in asset custody and administration (AUCA), an area with high barriers to entry given the significant capital investment required to build a business and the stickiness of customer...
