Eksportfinans ASA

The stable outlook on Eksportfinans reflects our expectation that the former export financing bank will continue to manage its rundown in a consistent manner. This includes maintaining a meaningful liquidity buffer to cover the outstanding structured funding. We expect Eksportfinans' ownership structure to remain unchanged and to support continued high capital and liquidity. We could lower the ratings if the bank's capital materially fell such that doubts arose regarding the cushion available to bondholders. Similarly, we would view negatively a deterioration in Eksportfinans' liquidity portfolio because this also provides a buffer for eventualities related to the outstanding funding structure. Furthermore, operational risks persist given that competence is now concentrated, and key personnel risk could harm what we think will be

...Eksportfinans' management has shown the capacity to manage outstanding structured funding while an orderly wind-down advances. Over the past 13 years, Eksportfinans has managed the wind-down of much of its balance sheet. Total assets stood at Norwegian krone (NOK) 9.2 billion (0.8 billion) at June 30, 2023, compared with NOK215.5 billion (187 billion) at year-end 2010. The bank's funding structure requires the ongoing management of derivatives as hedges as just under two-thirds are structured notes without maturity and have various triggers. That said, as the size and complexity of Eksportfinans' outstanding debt wanes, the risk of nonpayment reduces. We expect the sizable capital and liquidity cushions to remain over the medium term. Although risks to Eksportfinans' outstanding debt remain, its liquidity and capital buffers are ample. The bank had a liquidity buffer of about NOK7 billion (0.6 billion) equaling about three-quarters of its balance sheet, with high-quality liquid assets and...

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