Its rating has been downgraded from A- to BBB+, while its short-term rating of A-2 has been affirmed, and its outlook has been rated stable.
Standard & Poor’s says that under its revised bank criteria, its ratings for Northern Rock must be based on the group credit profile of Virgin Money and Northern Rock.
It says its assessment of the consolidated firm’s profile reflects its weak business position, strong capital and earnings, adequate risk position, average funding and adequate liquidity.
The ratings agency says the profile also reflects its view of the moderate likelihood of extraordinary government support.
It adds that the stable outlook reflects its expectation that the group’s capital and earnings will remain consistent with a strong assessment over the two-year outlook horizon.