Update: Euroclear Bank S.A./N.V.

The stable outlook reflects our view that the Euroclear group's creditworthiness will remain resilient. We expect that the group will maintain a leading position in securities settlement and post-trade activities, combined with satisfactory profitability and a favorable capital structure, with our RAC ratio forecast likely to remain above 15%. We could lower the ratings in the coming 12-24 months if the group's very strong market position deteriorated unexpectedly or following an increase in its debt-risk appetite that would push Euroclear's debt to EBITDA beyond 2.5x, for instance in case of a sizable leveraged acquisition. We could also lower the rating on Euroclear Bank if we changed our view of its core status to the wider group, but we consider this

...The Euroclear group is one of the world's largest providers of domestic and cross-border settlements services. Our ratings on Euroclear Bank reflect our view of its role as a core subsidiary of the Euroclear group. The group held assets under custody of 36.4 trillion as of March 31, 2023, which is broadly unchanged year-on-year but reflects a material 11% increase since end-2020. In 2022, the group processed 304 million netted transactions (up 3% from 2021, and more than 10% compared with 2020), which in euro equivalent terms is worth almost 1.1 quadrillion. While we keep watching developments in the area of decentralized finance, we currently see no significant risk that this will undermine Euroclear's role as a critical operator of national and international central securities depositories and provider of ancillary post-trade and financing services. Tailwinds from rising interest rates were largely responsible for the strong increase in Euroclear's underlying profitability in 2022 and...

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