CIS cor­po­rates may have sta­ble credit qual­ity across Europe

The Pak Banker - - Front Page -


Non- fi­nan­cial cor­po­rate is­suers in the Com­mon­wealth of In­de­pen­dent States (CIS) are more likely than those in other re­gions across Europe to main­tain their cur­rent rat­ing in the next 12-18 months, due to re­silient do­mes­tic GDP growth boosted by high com­mod­ity prices, says Moody’s In­vestors Ser­vice in a Spe­cial Com­ment pub­lished to­day.

Most rated CIS com­pa­nies have re­stored their fi­nan­cial sta­bil­ity in re­cent years as a re­sult of high oil and com­mod­ity prices thereby en­hanc­ing their abil­ity to weather macroe­co­nomic weak­ness and mar­ket volatil­ity in 2013, says Vic­to­ria Maisuradze, As­so­ciate Manag­ing Di­rec­tor and Head of Moody’s Cor­po­rate Fi­nance Group in Rus­sia. Within the CIS cor­po­rate sec­tor, the rat­ings of only five is­suers out of a to­tal of 71 rated by Moody’s in the re­gion had a neg­a­tive out­look or were on re­view for down­grade as at 30 Septem­ber 2012. There were no de­faults in the re­gion over the past year and Moody’s does not ex­pect a ma­te­rial in­crease in downgrades or neg­a­tive rat­ing ac­tions, or a spike in de­faults, in the next 12 months. All of the CIS cor­po­rates’ rat­ings are in the B-rat­ing cat­e­gory or higher, which im­plies a low near-term de­fault risk.

Moody’s ex­pects that a fur­ther slow­down in global eco­nomic growth would most ad­versely af­fect com­pa­nies in the min­ing, steel and petro­chem­i­cals in­dus­tries. How­ever, such a sce­nario, if it were to hap­pen, would not nec­es­sar­ily re­sult in neg­a­tive rat­ing ac­tions as these is­suers have rea­son­ably strong credit met­rics rel­a­tive to their rat­ing cat­e­gories.

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