S&P Global Ratings downgrades for three large banking groups
The move follows similar action last week when S&P junked the government's local currency debt
Ratings agency S&P Global Ratings downgraded the credit ratings of three of the four largest banking groups and their subsidiaries on Wednesday night, following similar action on government debt last week when it junked local currency debt. Nedbank and FirstRand Bank scored local and foreign currency ratings of BB, in line with the government (Barclays Africa and subsidiary Absa has national scale ratings of zaBBB+ and zaAA-). But FirstRand Bank’s five-year R1.5m note programme due in 2022 and its Aldermore acquisition drew special attention, attracting a weak rating of B+ and a dimmer view of its lower stand-alone credit profile. "We lowered the ratings on FirstRand Bank in line with the sovereign foreign currency ratings," said S&P. "We have also revised down the bank’s [stand-alone credit profile] … because of the higher risk weightings in our capital model, caused by the weaker sovereign ratings and the anticipated impact of the pending acquisition of Aldermore." FirstRand offer...
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