...- Hungary-based OTP Bank PLC (OTP) has broadened its geographical presence outside its home country, with its share of the Hungarian loan book falling to 32% of the total portfolio. This trend means less exposure to country risk in Hungary, in our view. - Because of this, we think that OTP's capital and liquidity ratios are resilient enough to withstand a potential stress scenario, even in the unlikely event of a default by Hungary. Therefore, we now rate OTP above the Hungarian sovereign. - That said, the bank would not be immune to a potential sovereign default, and we therefore cap OTP's long-term issuer credit ratings (ICRs) at a maximum of one notch above the sovereign foreign currency rating on Hungary. - As a result, we raised our long- and short-term ICRs on OTP Bank PLC and its core subsidiary, OTP Mortgage Bank, to '###/A-2' from '###-/A-3'. We also raised the long-term resolution counterparty ratings (RCRs) on both banks to '###+' from '###' and affirmed the short-term RCRs at...
