Fitch Ratings has changed the outlook on the long-term issuer default ratings of SinoPac Financial Holdings (TPE:2890) and subsidiaries Bank SinoPac, King's Town Bank, and Bank SinoPac (China) to positive from stable, according to a Monday release.
Fitch also maintained all of the companies' long-term issuer default ratings at BBB+.
Bank SinoPac's positive outlook considers Fitch's view that its merger with King's Town Bank could boost its credit profile through a wider franchise, improved business revenue, and increased profitability.
King's Town Bank accounted for 11% of the combined bank's assets on a pro forma basis at end-2025, Fitch said.
SinoPac Holdings' ratings and outlook are similar to those on the bank, which serves as the group's principal subsidiary.
The parent company should retain a moderate common equity double-leverage ratio over the medium term, even with a temporary spike last year after the acquisition, Fitch said.
Developments in the bank's franchise status, profitability, and impaired loan ratio following the merger as well could prompt rating actions, according to Fitch.