Research Update: La Banque Postale Upgraded To 'A+' On Parent Upgrade; Outlook Stable; Hybrids Downgraded One Notch On Decreased Capital

On Oct. 28, 2021, France-based La Banque Postale (LBP) announced its intention to fully acquire CNP Assurances (CNP) by purchasing the remaining 37% stake for €21.9 per share (€5.6 billion in total). We assume the takeover will go ahead and believe CNP's strategic fit with the wider La Poste group, CNP's improving performance, and receding uncertainty related to the pandemic will more than offset the cash outflow from the deal. That's why on Nov. 4, 2021, we raised our long-term issuer credit rating on LBP's parent, La Poste, to 'A+' from 'A'. We view LPB as a core member of the group, and therefore equalize our ratings on LBP with those on La Poste. We have therefore raised our long-term

...- On Oct. 28, 2021, France-based La Banque Postale (LBP) announced its intention to fully acquire CNP Assurances (CNP) by purchasing the remaining 37% stake for 21.9 per share (5.6 billion in total). - We assume the takeover will go ahead and believe CNP's strategic fit with the wider La Poste group, CNP's improving performance, and receding uncertainty related to the pandemic will more than offset the cash outflow from the deal. - That's why on Nov. 4, 2021, we raised our long-term issuer credit rating on LBP's parent, La Poste, to 'A+' from 'A'. We view LPB as a core member of the group, and therefore equalize our ratings on LBP with those on La Poste. - We have therefore raised our long-term issuer credit rating on LBP to 'A+' from 'A' and affirmed our 'A-1' short-term issuer credit rating. - We lowered our ratings on LBP's hybrid debt instruments by one notch because the planned acquisition will erode LBP's capital, reducing our risk-adjusted capital (RAC) ratio by an estimated 300...

Research Update