OREANDA-NEWS. Fitch Ratings has affirmed Citibank Taiwan Limited's (CTL) Long-Term Issuer Default Rating (IDR) at 'A' and National Long-Term Rating at 'AA+(twn)'. The Outlook is Stable. A full list of rating actions is at the end of this rating action commentary.

The affirmation follows Fitch's rating action on Citigroup Inc. (Citi, A/Stable/a), CTL's ultimate parent, on 19 May 2015 (see 'Fitch Affirms Citigroup's L-T IDR at 'A'; Outlooks Stable; Upgrades Citibank, N.A.' on www.fitchratings.com)

KEY RATING DRIVERS
IDRS, NATIONAL RATINGS, SUPPORT RATING

The IDR and Support Rating of '1' on CTL reflects the extremely high probability of support from its parent, Citibank N.A. (A+/Stable/a, Citi's major operating subsidiary), if needed. CTL's IDR is aligned with Citibank N.A.'s Viability Rating and their rating Outlooks are also aligned, given CTL is a core part of the group's global banking franchise and their highly integrated operations in risk management, a shared brand name and global network. Among Citi's Asian subsidiaries, CTL is one of the important contributors to the group's liquidity and earnings.

Like many of Citi's international subsidiaries, CTL is not specifically named as a material legal entity (MLE). The recovery and resolution plans of Citi and other global banks, including the designation of MLEs and the positioning of internal total loss-absorbing capacity (TLAC), continue to evolve. As a consequence, Fitch may reassess parent and subsidiary linkages as these issues become more permanent.

Fitch expects CTL to sustain its above-average earnings given its robust non-interest income generation, primarily from wealth management and forex and derivatives transactions. This, coupled with its strong loan-loss provisioning, should help absorb rising credit costs in a slowing economy. The bank's strong internal capital generation will help sustain its above sector-average capitalisation, although it will moderately decline given its high dividend payout policy. The bank's Fitch Core Capital ratio fell to 11.6% at end-1H15 from 13.6% at end-2014 due to dividend payouts. The average FCC ratio for Fitch-rated peers was 10.7% at end-1H15.

RATING SENSITIVITIES
IDRS, NATIONAL RATINGS, SUPPORT RATING

CTL's IDR and Support Rating are sensitive to any change in the ability and propensity of Citibank N.A. to provide timely support to CTL. The ratings would also be affected by the evolution of the group's recovery and resolution plan.

The rating actions are as follows:
CTL
Long-Term IDR affirmed at 'A'; Outlook Stable
Short-Term IDR affirmed at 'F1'
National Long-Term Rating affirmed at 'AA+(twn)'; Outlook Stable
National Short-Term Rating affirmed at 'F1+(twn)'
Support Rating affirmed at '1'