Archive

Tag Archives: rating

OVERVIEW

  • We are affirming our ‘BBB/A-2’ long- and short-term sovereign credit ratings on the Republic of Italy.
  • The affirmation reflects our view of Italy’s wealthy and diversified economy, as well as our expectation that the government will make some progress on important structural and fiscal reforms.
  • The outlook on the long-term rating remains negative, reflecting our view of risks to the public sector balance sheet from weak real and nominal growth prospects.

RATING ACTION

On June 6, 2014, Standard & Poor’s Ratings Services affirmed its unsolicited ‘BBB’ long-term and ‘A-2’ short-term sovereign credit ratings on the Republic of Italy. The outlook on the long-term rating remains negative.

Read More

OVERVIEW

  • We have revised our average 2014-2016 real GDP growth projections for Spain upward to 1.6% from 1.2% reflecting the effects of labor and other structural reforms.
  • We are therefore raising our long- and short-term sovereign credit ratings on Spain to ‘BBB/A-2′ from ‘BBB-/A-3′.
  • The outlook is stable, reflecting our current view that risks to the ratings on Spain will remain balanced over the next two years.

Read More

London 25 April 2014

Fitch Ratings has revised Italy’s Outlook to Stable from Negative. At the same time the agency has affirmed Italy’s Long-term foreign and local currency Issuer Default Ratings (IDRs) at ‘BBB+’. The issue ratings on Italy’s senior unsecured foreign and local currency bonds were also affirmed at ‘BBB+’. The Country Ceiling has been affirmed at ‘AA+’ and the Short-term foreign currency IDR at ‘F2’.

Read More

OVERVIEW

  • We expect Portugal to achieve its program fiscal deficit target of 5.5% of GDP in 2013 as the economy stabilizes.
  • In our view, the coalition government remains committed to the EU/IMF program.
  • We are therefore removing our long-term sovereign credit rating on Portugal from CreditWatch with negative implications, and affirming the ratings at ‘BB/B’.
  • The outlook is negative, reflecting what we view as ongoing social and political risks associated with deleveraging efforts by Portugal’s highly indebted private and public sectors, as well as financing uncertainties related to Portugal’s exit from the EU/IMF program, expected in May 2014.

Read More

Standard & Poor’s Ratings Services today said it has taken rating actions on 32 Italian financial institutions.

These include affirming our counterparty credit ratings on 15 entities, lowering our ratings on 15, removing the ratings on four from CreditWatch negative, and revising the outlook on one.

The rating actions reflect our view of increased credit risk for the Italian economy and its banks. They follow our revision of our economic risk score for Italy, one of the main components of our Banking Industry Country Risk Assessment (BICRA), to ‘5’ from ‘4’. We have maintained our BICRA for Italy at group ‘4’ and our industry risk score at ‘4’ (see “BICRA On Italy Maintained At Group ‘4’, Economic Risk Score Revised To ‘5’ On Increased Credit Risk For Italian Banks,” published Aug. 3, 2012, on RatingsDirect on the Global Credit Portal).

With Italy facing a potentially deeper and more prolonged recession than we had originally anticipated, we think Italian banks’ vulnerability to credit risk in the economy is rising. In this context, the combined effect of mounting problem assets and reduced coverage of loan loss reserves makes banks more vulnerable to the impact of higher credit losses particularly in the event of deterioration in the collateral values of assets.

In our opinion, a more severe recession will likely push up the stock of Italian banks’ problem assets in 2012 and 2013 to levels higher than we previously expected and high relative to the stocks in other banking systems in Europe. At the same time, the banks’ coverage of problem assets through provisioning, which was already low by international standards because of the banks’ extensive use of tangible collateral in their assessment of provisioning needs, has fallen further over the past few years.

We will publish individual research updates on the banks identified below, including a list of ratings on affiliated entities, as well as the ratings by debt type senior, subordinated, junior subordinated, and preferred stock.

See the list below for the rating actions on the financial institutions and their relevant subsidiaries.

Read More

Fitch Ratings has affirmed Italy’s Long-term foreign and local currency Issuer Default Ratings (IDRs) at ‘A-‘ with a Negative Outlook.

The short-term foreign currency rating is affirmed at ‘F2’ and the country ceiling at ‘AAA’. In affirming Italy’s sovereign ratings Fitch has sought to look beyond current economic and financial conditions and take into account recent and prospective structural reforms that would enhance the growth potential of the economy as well as its assessment that debt stabilisation and reduction is within reach.

In addition, the affirmation reflects the demonstrated commitment of the government to reducing the budget deficit and public debt, as well as parliament’s adoption of a balanced budget amendment to the Constitution and ratification of the Fiscal Compact. The affirmation of Italy’s sovereign ratings’ is based on the following key factors and judgements.

Read More

Moody’s downgrades Italy’s government bond rating to Baa2 from A3, maintains negative outlook

Frankfurt am Main, July 13, 2012. Moody’s Investors Service has today downgraded Italy’s government bond rating to Baa2 from A3. The outlook remains negative. Italy’s Prime-2 short-term rating has not changed.

The decision to downgrade Italy’s rating reflects the following key factors:

1. Italy is more likely to experience a further sharp increase in its funding costs or the loss of market access than at the time of our rating action five months ago due to increasingly fragile market confidence, contagion risk emanating from Greece and Spain and signs of an eroding non-domestic investor base. The risk of a Greek exit from the euro has risen, the Spanish banking system will experience greater credit losses than anticipated, and Spain’s own funding challenges are greater than previously recognized.

2. Italy’s near-term economic outlook has deteriorated, as manifest in both weaker growth and higher unemployment, which creates risk of failure to meet fiscal consolidation targets. Failure to meet fiscal targets in turn could weaken market confidence further, raising the risk of a sudden stop in market funding.

Read More