Fitch cuts ratings on South Africas major banks following sovereign downgrade.

By bne IntelliNews January 16, 2013
Fitch Ratings has lowered by one notch the viability ratings of South Africas five biggest banks - Absa Bank, FirstRand Bank, Standard Bank, Nedbank, and Investec Bank and also the long-term foreign currency Issuer Default Rating (IDR) of four of the banks (excluding Absa) following the recent downgrade of the South African sovereign rating to BBB from BBB+. The ratings agency explained that the downgrades reflect the five major banks' concentration to South Africa, a high proportion of liquid assets invested in government securities and a weakening operating environment as indicated by the sovereign downgrade. The viability ratings of FirstRand, Nedbank, Standard Bank and Absa were downgraded to bbb, while Investec's is one notch lower at bbb-. The long-term IDRs of FirstRand, Nedbank and Standard Bank were cut to BBB from BBB+ and Investec's IDR was lowered to BBB- from BBB. Absas long-term IDR was affirmed at A-, as it is driven by the ratings of its 55.5%-owner, UK-based Barclays Bank (A/Stable), as Fitch considers Absa as being a strategically important subsidiary. The National Ratings of the major banking groups, excluding Absa, were affirmed, while Absa's National Long-term ratings have been upgraded to AAA(zaf).

Related Articles

South Africas Exxaro mulls firing striking coal miners.

South African company Exxaro Resources said one of the options it currently considers is dismissing striking coal mine workers who fail to return to work in the week of March 25, fin24 reported ... more

South Africas Telkom says there is no decision to lay off 13,000 employees.

South Africas telecommunication operator Telkom said that it has not made a decision on retrenching 13,000 employees, or more than half of its staff, TechCentral reported quoting a company ... more

BP, Masana Petroleum Solutions sell LPG business in South Africa.

Oryx Energies, a major independent provider of oil and gas products and services in Africa, has agreed to buy the South African liquefied petroleum gas (LPG) distribution businesses of BP and ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss