International rating agency Moody's, on April 5, has upgraded to A2 from A3 the rating of the covered bond issued by Alpha Bank Romania (ABR or the issuer, CR Assessment Baa3(cr)) under its Alpha Bank Romania S.A. - Mortgage Covered Bonds program.

The upgrade of the covered bond rating follows the upgrade of the CR assessment of the issuer by one notch.

Moody's upgraded the long-term deposit ratings of Alpha Bank Romania to Ba1 from Ba2, and changed the outlook on these to stable from positive on April 5.

The upgrade of ABR's BCA to ba3 from b1 reflects the recent upgrade of its parent bank's BCA to b2 from b3, as a result of an improvement in parent Alpha Bank's credit profile.

The stronger creditworthiness of Alpha Bank reduces risks for its subsidiary ABR, which stem contagion risks because of existing financial and operational linkages between ABR and Alpha Bank. These linkages had constrained the BCA of ABR, which, absent of contagion risk considerations, was already commensurate with a higher BCA.

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andrei@romania-insider.com