Fitch downgraded Clydesdale Bank today (Friday) from AA- to A+ because it considers the bank may be of less strategic importance to its parent, National Australia Bank, but did not touch its AAA covered bond rating.

The cut follows a similarly motivated move by Moody’s, which on Wednesday lowered Clydesdale’s rating from A1 to A2.

Fitch said that Clydesdale’s rating is driven by its 100% parent.

“The downgrade of the IDRs reflects Fitch’s belief that the strategic importance of CB to its parent, National Australia Bank Limited (NAB; ‘AA’/Stable), may be diminishing slightly,” said Fitch. “This reflects the more stringent regulation and a less favourable economic environment in the UK, which may indicate that the UK banking sector has become less attractive to foreign banks.

“Although support from NAB for CB remains extremely likely,” it added, “the wider notching reflects Fitch’s view that support is marginally less strong than was previously the case. Downside for the IDRs could arise from further changes in Fitch’s view of CB’s strategic importance to NAB.”

Fitch said that the rating action has no implications for the AAA rating of Clydesdale’s covered bonds.