Members Equity Bank Pty Ltd. Dec 10

Standard & Poors, December 2010

Abstract
Strong asset quality underpinned by high proportion of low-risk first mortgages that are 100% mortgage insured Robust capital ratios and good shareholder support Execution risk associated with a recent significant change in strategy, notwithstanding the strategy is consistent with core strengths Funding concentration with heavy, albeit declining, reliance on confidence-sensitive securitization funding Modest earnings profile The 'BBB' counterparty credit rating on Members Equity Bank Pty Ltd. (MEB) reflects the bank's strong asset quality, underpinned by a low-risk credit profile that benefits from the loan portfolio's high proportion of low-risk, first-mortgage, owner-occupied home loans, which are 100% mortgage insured. The ratings also recognize MEB's robust capital ratios and good shareholder support. Offsetting these strengths is MEB's exposure to execution risk related...

Companies mentioned in this report are:
- Members Equity Bank Pty Ltd.
- Bank of Queensland Ltd.
- Bendigo and Adelaide Bank Ltd.
- Heritage Bank Ltd.
- TSB Bank Ltd.
- Rural Bank Ltd.

Action: Review

Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.

Research Type: Full Analysis

- Members Equity Bank Pty Ltd.
- Bank of Queensland Ltd.
- Bendigo and Adelaide Bank Ltd.
- Heritage Bank Ltd.
- TSB Bank Ltd.
- Rural Bank Ltd.

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