Fitch’s rating analysis was done at the request of Triodos Bank. The rating gives Triodos Bank a better position on the financial markets should the need arise. It will improve access to institutional debt funding and potentially reduce the cost of funding. Therefore, it supports the bank's financial health.
According to Fitch, Triodos Bank’s ratings reflect its established niche franchise in the growing sustainable banking segment and a sound record of execution on its strategy. “The ratings are supported by the bank's adequate asset quality and solid capitalisation and also reflect its healthy funding and liquidity profile and continued growth strategy.” The bank's modest profitability is a rating weakness, says Fitch, noting that profitability has been historically modest but stable.The bank's sound capitalisation is considered a rating strength.
The Stable Outlook reflects Fitch’s view that Triodos Bank’s ratings have sufficient headroom at their current level to absorb significant shocks under various scenarios to Fitch’s baseline economic forecast.