Moody’s assigned Counterparty Risk (CR) assessments to several German banking groups and nine public sector banks on Friday that are in most cases higher than previous covered bond anchor reference points, although an analyst noted that while UniCredit Pfandbriefe are likely to be upped to Aaa, pbb’s will not benefit.

The rating actions, which also included changes to the banks’ senior unsecured debt ratings in many cases, completed a review relating to the implementation of Moody’s new bank rating methodology.

In line with the new methodology, Moody’s on Friday announced that it had assigned the eight German banking groups and their branches and subsidiaries a new CR assessment, which is the new reference point for covered bond anchors.

Among the institutions affected by the rating actions were:

- Commerzbank: senior unsecured debt rating confirmed at Baa1, assigned CR assessment of A3.

- Deutsche Pfandbriefbank: senior unsecured debt rating downgraded from Baa2 to Ba1, assigned CR assessment of Baa3.

- EEPK: senior unsecured debt rating upgraded from Ba2 to Baa3, assigned CR assessment of Baa2.

- Hypothekenbank Frankfurt: senior unsecured debt rating upgraded from Baa3 to Baa1, assigned CR assessment of A3.

- ING DiBa: senior unsecured debt rating upgraded from Baa1 to A3, assigned CR assessment of Aa3.

- UniCredit Bank: senior unsecured debt rating upgraded from Baa1 to A3, assigned CR assessment of A1.

Maureen Schuller, head of covered bond strategy at ING, noted that the rating actions will have varied implications for German covered bond ratings.

She said that UniCredit Bank’s A1 CR assessment allows for a Aa3 covered bond anchor, which, considering a Timely Payment Indicator (TPI) of “high”, means the TPI Leeway on its current Aa1 public sector and mortgage covered bond ratings improves significantly from the previous one notch at an anchor of Baa1.

“Considering the current review for upgrade on the ratings this is likely to result in an uplift of these ratings to Aaa,” she said. “However, not all issuers will benefit from an uplift.

“The counterparty risk assessment for Deutsche Pfandbriefbank, for example, was set at Baa3, which allows for a covered bond anchor at Baa2. However, this is the same level as the issuer’s senior unsecured rating before this rating was downgraded to Ba1. Hence at a TPI of “high” the maximum achievable rating for this issuer remains unchanged at Aa1.”

In another set of rating actions, Moody’s on Friday also assigned CR assessments to nine German public sector banks, all of which may now potentially benefit from more notches of uplift for their covered bond ratings.

Although HSH Nordbank’s covered bond anchor reference point remains unchanged, its covered bond anchor has improved by one notch to Baa2, Schuller noted.

Among the institutions affected by the rating actions were:

- Bayerische Landesbank: senior unsecured debt rating confirmed at A3, assigned CR assessment of A2.

- Berlin Hyp: senior unsecured debt rating confirmed at A2, assigned CR assessment of A1.

- DekaBank Deutsche Girozentrale: senior unsecured debt rating upgraded from A1 to Aa3, assigned CR assessment of Aa2.

- HSH Nordbank: senior unsecured debt rating confirmed at Baa3, assigned CR assessment of Baa3.

- Kreissparkasse Köln: senior unsecured debt rating downgraded from Aa3 to A1, assigned CR assessment of Aa1.

- Landesbank Baden-Württemberg: senior unsecured debt rating upgraded from A2 to A1, assigned CR assessment of Aa3.

- Landesbank Hessen-Thüringen: senior unsecured debt rating upgraded from A2 to A1, assigned CR assessment of Aa3.

- NordLB: senior unsecured debt rating confirmed at A3, assigned CR assessment of A2.

- Sparkasse KölnBonn: senior unsecured debt rating confirmed at A1, assigned CR assessment of Aa3.

Moody’s meanwhile on Friday upgraded from Aa1 to Aaa the ratings of the mortgage covered bonds and public-sector covered bonds of SEB AG, after assigning the issuer a CR assessment of Aa3, which raised the programme’s covered bond anchor.