From SENS
Standard Bank South Africa’s (SBSA) share price is down on the day (10h45) after notice had been given by the bank that Fitch has revised the outlook to negative on the long term Issuer Default Ratings (“IDR”) of SBSA following the revision of the South African sovereign rating to negative outlook on 13 June 2014.
Fitch describes the change in outlook as reflective of the bank’s concentration to South Africa, a high proportion of liquid assets invested in government securities and a weakening operating environment as indicated by the negative outlook on the sovereign rating. The sovereign rating is effectively acting as a cap on large South African banks’ Viability Ratings (“VR”) at this rating level because of their strong links with South Africa.
National ratings reflect the creditworthiness of an issuer relative to the best credit in the country. The outlooks on the National Ratings assigned to SBSA have been maintained on stable, reflecting Fitch’s expectation that its ranking relative to the best credit in the country will remain stable. SBSA’s VR continues to reflect a strong domestic franchise, which underpin stable core earnings, sophisticated risk management, and acceptable liquidity and capitalisation.
Summary of ratings affected by revised outlook:
Long-term foreign currency IDR: affirmed at ‘BBB’; Outlook revised to Negative from Stable
Long-term local currency IDR: affirmed at ‘BBB’; Outlook revised to Negative from Stable
Short-term foreign currency IDR: affirmed at ‘F3’
Viability Rating: affirmed at ‘bbb’
Support Rating: affirmed at ‘3’
Support Rating Floor: affirmed at ‘BB+’
National Long-term rating: affirmed at ‘AA(zaf)’; Outlook Stable
National Short-term rating: affirmed at ‘F1+(zaf)’
Senior unsecured debt: Long-term foreign currency rating affirmed at ‘BBB’; Short-term
foreign currency affirmed at ‘F3’
For commentary on the detailed ratings action taken on SBSA together with the other South African Banks, refer to the Fitch press release on their website.
For the full SENS report, Click Here
