MUMBAI (Thomson Financial) - Fitch Ratings said it upgraded Japanese regional bank Chiba Bank's foreign and local currency long-term issuer default rating (IDR) to 'A' from 'A-' with a stable outlook and Hokkaido Bank Ltd's individual rating to 'C/D' from 'D', citing the improvements in capitalisation and asset quality.

Fitch also upgraded Chiba Bank's individual rating to 'B/C' from 'C' and affirmed its foreign and local currency short-term IDRs at 'F1'.

Fitch affirmed Hokkaido Bank's foreign and local currency long-term IDRs at 'BBB-' with a positive outlook and the short-term IDR at 'F3'.

The ratings agency also affirmed Hokuriku Bank's foreign and local currency long-term IDRs at 'BBB-' with a positive outlook, short-term IDR at 'F3', and the individual rating at 'D'.

The regional banks have strong franchises in their respective regions, Fitch said. Though there are competitive pressures from 'megabanks' and, potentially in the long term, Yucho Bank, regional banks have cheap depositor funding, and should benefit from future increases in interest rates and deregulation allowing them to offer a wider range of insurance products, Fitch said.

TFN.newsdesk@thomson.com

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