Fitch Investors Service Inc. raised the long- and short-term certificates of deposit and letters of credit of Chemical Bank and Texas Commerce Bank to A-plus/F-1 from A/F-1.
In addition, Fitch now rates the credit trend of Chemical Banking Corp. "improving," up from "stable."
Fitch affirmed the ratings on banking company's senior debt as "A," the subordinated debt as A-minus, the preferred stock as BBB-plus, and commercial paper as F-1.
"The asset quality is improving, so the need to set high loan loss provisions isn't as great," said Fred DeBussey, an analyst with Fitch. "We expect to see continued tight control of their overhead."
Chemical has emerged as a revitalized, more clearly focused banking company follow its first year of combined operations with the former Manufacturers Hanover Corp., said Fitch.
While the banking company faced several obstacles in 1992, its first year of operation, a solid operating performance and a stronger balance sheet met the bank's forecasts at the time of the merger.
The ratings agency said Chemical is regaining its position as a pre-eminent corporate bank, which complement its retail and middle market business.
Fitch said Texas Commerce's addition of the former First City Bancorp. of Texas' principal assets is indicative of management's confidence in the bank's ability to create earnings and enhance franchise value from in-market acquisitions.
