NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) has assigned a senior unsecured debt rating of BBB, subordinated debt rating of BBB- and short-term rating of K3 to Heritage Commerce Corp (NASDAQ: HTBK, “Heritage”), a bank holding company headquartered in San Jose, California. In addition, KBRA has assigned a deposit rating of BBB+, senior unsecured debt rating of BBB+, and a short-term rating of K2 to its subsidiary, Heritage Bank of Commerce (“the Bank”). The outlook on all ratings is stable.
The ratings are supported by Heritage’s financial fundamentals as indicated by strong asset quality and healthy reserve coverage, above peer TCE ratio, stable returns and high net interest margin. In addition, Heritage’s steady revenue growth, improving efficiency and low cost of funds underpin the ratings. Ratings are constrained by Heritage’s spread-reliant earnings streams, earnings losses following the peak of the 2008 financial crisis, and relatively low overall market share, although market share is strong among community banks within Heritage’s footprint.
The ratings are based on KBRA’s Global Bank and Bank Holding Company Rating Methodology published on January 28, 2015.
Please use the following link to view the report: www.krollbondratings.com/show_report/3228
About Kroll Bond Rating Agency
KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).