Moody’s upgraded apoBank yesterday (Wednesday) because it considers that the bank’s financial profile has strengthened, and put Deutsche Postbank on review for downgrade, as a result of the same rating action on its parent, Deutsche Bank.

Deutsche Apotheker- und Ärztebank was upgraded from A2 to A1, on stable outlook, because Moody’s considers that the bank’s financial profile has improved, in particular as a result of it reducing its exposure to higher risk assets and improving the quality and size of its capital base.

These developments led Moody’s to upgrade the bank’s standalone bank financial strength rating (BFSR) by two notches, which in turn fuelled the upgrade of the long term ratings.

“ApoBank’s essentially completed divestment of non-core legacy risk portfolios has materially reduced asset quality-related vulnerabilities,” said the rating agency.

It also yesterday placed Deutsche Postbank on review for downgrade, a move prompted by Moody’s on Tuesday placing its parent on review for downgrade over concerns about its profitability. Postbank is rated A2, the same as Deutsche Bank.

“During the review, Moody’s will reassess its support assumptions of parental support, which currently provide Postbank’s long term debt and deposit ratings with five notches of rating uplift,” said the rating agency. “Postbank’s long term ratings also take into account its role as one of the major deposit-taking institutions in Germany, as well as its key role in the German banking sector’s payments system.”