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#Credit Rating

# credit-rating - Friday 12 August, 2011

US markets watchdog investigating alleged insider trading at S&P

The Securities and Exchange Commission is reportedly asking Standard & Poor’s to account for anyone who knew about the US downgrade.

# credit-rating - Wednesday 10 August, 2011

US stocks slump amid fears about European banks

The Dow Jones has fallen back again following yesterday’s gain.

Under-fire Cyprus 'will probably need a bailout' - Fitch

Economic struggler Cyprus’s rating is cut by two notches, though it’s still well above the ‘junk’ threshold for the time being.

# credit-rating - Tuesday 9 August, 2011

All eyes on the Fed as choppy markets make small gains

Markets in New York are recording tentative gains as the Federal Reserve meets to discuss potential action.

Is this the bottom? Europe reverses early losses as markets turn green

European stock markets opened with more losses, but are moving upward again as traders expect a strong US opening.

Global stock markets plummet overnight

Global stocks continued to tumble overnight following a disastrous day on Wall Street yesterday – with world markets wiping €1.75 trillion off global stocks.

# credit-rating - Monday 8 August, 2011

Dow disaster: 632-point drop is the 6th-worst in history

The Dow Jones ends its day deep in the red, as the S&P loses 6.6 per cent and the NASDAQ sheds nearly 7 per cent of its value.

The Daily Fix: Monday

In today’s fix: Obama says ‘yes we cAAAn’, more violence in London, picture emerges of Norway’s killer polar bear, and the man who’s gone back to his desk job, after being president of Somalia…

Obama says US will "always be a AAA country" no matter what agencies say

The US president has made his first public comments since S&P downgraded the United State’s credit rating on Friday.

S&P's "stunning lack of knowledge" shown in US downgrade

News of the weekend’s rating downgrade hasn’t gone down well with US Treasury Secretary Timothy Geithner…

# credit-rating - Saturday 6 August, 2011

The 9 at 9: Saturday

Everything you need to know by 9am including bad news for the US; Gaybo for the Áras; a hero security guard; and the end of Facebook spam?

Downgraded: US loses AAA credit rating for the first time ever

Standard & Poor’s decision makes it the first time the US’ credit rating has fallen below the highest level, AAA, which it has held since 1917.

# credit-rating - Friday 5 August, 2011

S&P upbeat about Ireland's return to bond markets

The ratings agency says its maintaining its debt ratings for Ireland and describes the country’s economic outlook as ‘stable’.

# credit-rating - Thursday 14 July, 2011

Rock bottom? Greece gets the lowest credit rating in the world...again

Fitch has given Greece a CCC rating, following on from other credit rating agencies last month.

# credit-rating - Wednesday 6 July, 2011

Ireland could be next to face 'junk' status after Portugal - report

Portugal’s credit rating being downgraded to junk status by Moody’s yesterday could pose a “contagion risk” for Ireland, say experts.

EU Commission criticises ratings agencies

Commission President Barroso suggests market “bias” against European countries because of agencies’ reports.

# credit-rating - Tuesday 14 June, 2011

The Daily Fix: Tuesday

All the day’s news, and the bits and pieces you may have missed…

The 9 at 9: Tuesday

Nine things to know this morning, including: the funeral of the late Brian Lenihan; Greece has lowest-rated credit in the world; and what women really want…

# credit-rating - Thursday 2 June, 2011

Credit ratings agency Moody's warns of possible US downgrade

Warning comes as US government and Treasury struggle to reach agreement over increasing the country’s debt limit.

Greece close to securing the next €12bn tranche of bailout funds

Following reports suggesting the IMF may not approve the next installment of funds for Greece, Germany has moved to ensure the market that the EU/IMF will continue to back the bailout plan.

# credit-rating - Friday 15 April, 2011

Ireland's credit rating cut again to the same level as Iceland, Tunisia, and Romania

Ireland’s rating is one notch off junk status after the latest forecast by Moody’s which doesn’t offer much hope for the future.

# credit-rating - Friday 1 April, 2011

Take 5: April Fool's Day

5 stories, 5 minutes, 5 o’clock.

Standard and Poor's downgrades Ireland's credit rating

The silver lining? We’ve been taken off S&P’s CreditWatch list.

# credit-rating - Friday 17 December, 2010

Moody's cuts Irish rating by FIVE notches

Ireland goes from Aa2 to Baa1 in one swoop – and now lies just a few notches above being officially ‘junk’.

# credit-rating - Thursday 9 December, 2010

Ireland's credit rating slashed by three grades to BBB+

We are now just two levels above Greece as Fitch downgrade us for the cost of supporting banking system.

# credit-rating - Wednesday 6 October, 2010

Fitch downgrades Ireland, sets outlook to negative Credit Rating

Fitch downgrades Ireland, sets outlook to negative

The agency points to the cost of the Anglo bailout to explain the downgrade.

# credit-rating - Friday 17 September, 2010

Moody's downgrade rating of Anglo Irish bonds

The ratings agency cites concerns over the liquidity of Anglo’s commercial assets for downgrading from AAA to AA2.

# credit-rating - Wednesday 25 August, 2010

THE NATIONAL TREASURY MANAGEMENT AGENCY – the body which manages Ireland’s borrowing requirements, and its national debt – has criticised the decision of ratings agency Standard & Poor’s to downgrade Ireland’s debt rating.

The decision from S&P to downgrade the ratings – down to AA- from a previous rating of AA – means that Irish debt is seen as a riskier investment, and will likely see the NTMA required to increase it pays to investors who buy Irish debt.

NTMA chief John Corrigan told RTÉ that S&P’s analysis was based on an “extreme estimate” that the final cost of the government’s bank recapitalisation programme would reach €50 billion.

“We have taken issue with the rating agency,” he said. “It’s something we don’t like to do but there comes a point when the analysis is not robust.”

Last night, as news of the downgrade broke, the NTMA issued a statement with a similar conclusion, describing the approach as “flawed“.

What does it mean?

But why is the NTMA so annoyed – and how important is it that our rating has been downgraded?

Well, basically Ireland’s national rating is similar to the credit rating a person might get. If you’re good at making loan repayments or have a lot of money in the bank, you’ll get a good rating. If you struggle to repay your debts and don’t have much assets, you’ll get a lower rating and it therefore becomes tougher for you to to borrow.

As the name might suggest, an ‘AAA’ (or “triple A”) rating is the best one the agency can offer, with progressively fewer As – and the occasional plus or minus – being given to lower rankings.

Ireland’s new score of AA- isn’t exactly top of the class, but it’s still definitely in the upper reaches of the scores S&P assigns. We’re still very far away from being called ‘junk’. In fact, we could slip to a single A or even to BB before we’re given that ignominious title.

The only difference is that unlike the Moody’s downgrade last month, which brought its rating in line with those of S&P and the other main ratings agency Fitch, this change brings Ireland’s average another step downward.

We won’t find out for some time how the downgrade will affect us, however – the NTMA’s next bond auction isn’t until September 21, and the agency has already raised 99% of Ireland’s fundraising target for the year with three auctions still to go.

It will also be interesting to see whether the other agencies follow suit, with the S&P rating based on an arguably inflated estimate of how much the bank bailout will ultimately cost. Other ratings may be a little more conservative than S&P’s €50bn projection.

IRELAND’S NATIONAL DEBT might be becoming more expensive as a direct result of the decision by ratings agency Standard & Poor’s – but at least we can console ourselves in fact that the Financial Times has been amused by the whole thing.

Writing on the paper’s Alphaville blog this morning, Neil Hume seems to take great delight in the “punch-up” (in his words) between “a downgraded sovereign and a rating agency”.

Reporting that Ireland had “come out swinging” after the S&P move to downgrade Ireland’s sovereign rating from AA to AA-, Hume quotes a rep from the National Treasury Management Agency in a piece from Reuters.

The emphasis is that of the FT:

In a strongly worded statement, the National Treasury Management Agency said it disagreed with S&P’s view that Ireland faced substantially higher costs to bail out its ailing banking sector.

“In terms of the specific analysis by S&P, this is largely predicated upon an extreme estimate of bank recapitalization costs of up to 50 billion euros,” the NTMA said.

We believe this approach is flawed.”

It also points out that the ‘spread’ – the percentage difference in interest offered – in German and Irish government bonds has now reached a record 3.29%, while in August 2007 Irish borrowing was cheaper than that of Germany.

“Either way,” Hume concludes, “its [sic] provided some entertainment on a quiet summer trading day.”

The New York Times’ much-respected economics blogger, Paul Krugman, has offered solace for worried Irish investors by suggesting that ratings agencies are not the be-all and end-all, however.

Writing on his blog, Krugman offers a brief reminder that Moody’s and S&P – the two agencies that have downgraded Ireland’s ratings in the past weeks – gave Japanese debt a similar treatment in 2002.

Although the moves ranked Japanese debt as a riskier investment than that of Bostwana and Estonia, Japan can still borrow with less than 1% interest a full eight years later.

# credit-rating - Tuesday 13 July, 2010

RATING’S AGENCY Moody’s has cut Portugal’s rating by two spots to A1, Reuters reports. Moody’s says their outlook is stable, meaning no further rating change is expected for at least a year, but Portugal may need to introduce more austerity measures in 2011 to keep it that way. The euro fell to a one-week low against the dollar following the news.