Fitch Ratings says that the announcements by banking giants, Barclays PLC and ABN Amro Holding NV, that they have entered into exclusive preliminary discussions regarding a potential combination of the two organizations does not have an immediate impact on either bank’s ratings.

The announcements were scant in detail and it is possible that no deal will emerge, Fitch said. “Further clarification is needed on the terms of any transaction (including the impact on capital adequacy) and likely governance and corporate/business structures before Fitch can be in a position to opine on the rating impact for either bank, if any, of a deal,” the rating agency says, adding, “A transaction could give rise to significant execution risk and to governance issues.”

The banks’ wholesale and investment banking and asset management businesses offer most scope for revenue and cost synergies, Fitch suggested. “For Barclays, ABN AMRO’s operations in Brazil, the Middle East and Asia are also likely to be attractive. However, the strategic attractiveness to Barclays of ABN AMRO’s banking operations in the US and Italy and its retail banking business in the Netherlands is less obvious,” Fitch concludes.