Arab Today, arab today ireland\s stricken banking sector in doldrums
Last Updated : GMT 21:46:51
Arab Today, arab today
Arab Today, arab today

Bond ratings downgraded

Ireland\'s stricken banking sector in doldrums

Arab Today, arab today

Arab Today, arab today Ireland\'s stricken banking sector in doldrums

Moody's has lowered its credit ratings on Ireland by two notches to Baa3 from Baa1.
Dublin - AFP

Moody's has lowered its credit ratings on Ireland by two notches to Baa3 from Baa1. Moody's on Friday cut its credit ratings on Ireland by two notches to just above junk status, citing an "expected decline" in government finances that is set to hamper the indebted nation's recovery .
"Moody's Investors Service has today downgraded Ireland's foreign- and local-currency government bond ratings by two notches to Baa3 from Baa1," a statement said.
It added that the outlook on the ratings "remains negative" - meaning further downgrades are possible.
Downgrades by ratings agencies like Moody's can ramp up borrowing costs on markets for those hit, making their funding problems more difficult to manage, while eurozone member Ireland is already struggling to service its huge debt.
The new ratings for Ireland - which recently needed an international bailout worth 85 billion euros ($123 billion) - is just one notch above BB, or junk status.
Government bonds afforded such a rating are said to carry high risk and thus need to offer sizeable yields to investors.
Explaining Friday's downgrades, Moody's pointed to "further weakening of the Irish government's financial strength, given the subdued economic activity and the crystallization of additional bank contingent liabilities."
It added: "From a sovereign perspective, the recent completion of the Irish bank stress test has led to further bank contingent liabilities weighing on the government's balance sheet."
Ireland's central bank last month ordered a drastic overhaul of the nation's stricken banking sector as the cost of bailing out its lenders was set to top 70 billion euros.
On Thursday, the central bank forecast that the country would grow by only 0.9 percent in 2011, down from an earlier estimate of 1.0 percent.
Formerly known as the Celtic Tiger for roaring growth spanning almost a decade from the late-1990s, the Irish economy has contracted for the last three years.
Ireland's 85-billion-euro debt rescue, agreed in November with the European Union and the International Monetary Fund, is partly required to bolster its ailing banking sector, which was crippled by the financial crisis.
On Friday, Moody's warned that the government's financial strength may also suffer from a series of interest rate hikes by the European Central Bank.
"Specifically, Ireland's finances may be impacted by the resulting increase in its own funding costs, as well as by the adverse impact of rising interest rates on Irish consumers, given that more than 70 percent of Irish mortgages are variable-rate mortgages," it added.
The European Central Bank last week hiked interest rates from a record low level - by a quarter point to 1.25 percent - to tame rising prices.
Moody's on Friday added that its Ireland downgrades were partly based on uncertainties surrounding how and under what circumstances the European Union might provide additional liquidity support.
It also said that should Ireland's government fail to meet its fiscal consolidation goals, a further rating downgrade would likely follow. "A further deterioration in the country's economic outlook would also exert downward pressure on the rating."
Earlier this year, Brian Cowen's centrist Fianna Fail administration was ousted from power as Irish voters vented their anger over the bailout.
Enda Kenny became Ireland's prime minister after a dramatic general election, and now heads a coalition government of his centre-right Fine Gael party and centre-left Labour.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today ireland\s stricken banking sector in doldrums Arab Today, arab today ireland\s stricken banking sector in doldrums

 



Arab Today, arab today

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today ireland\s stricken banking sector in doldrums Arab Today, arab today ireland\s stricken banking sector in doldrums

 



Arab Today, arab today France defies terrorism through tourism

GMT 15:18 2017 Saturday ,20 May

France defies terrorism through tourism
Arab Today, arab today Zainab Fadel Oglu designs “Shakerin” mosque

GMT 12:13 2017 Thursday ,11 May

Zainab Fadel Oglu designs “Shakerin” mosque
Arab Today, arab today Seeks to move past rift with Israel

GMT 08:00 2017 Monday ,08 May

Seeks to move past rift with Israel
View News in Arabic - Business: أخبار الأعمال
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Mozambique's gas boom dream under threat

GMT 16:29 2017 Monday ,08 May

Mozambique's gas boom dream under threat
Arab Today, arab today Prepares to give stargazers an eyeful

GMT 13:38 2017 Monday ,06 March

Prepares to give stargazers an eyeful
Arab Today, arab today Jaguar displays XF Sportbrake line

GMT 14:36 2017 Monday ,08 May

Jaguar displays XF Sportbrake line
Arab Today, arab today BMW sees forecasts in reach

GMT 09:04 2017 Thursday ,04 May

BMW sees forecasts in reach
Arab Today, arab today Climate science: Bad news gets worse

GMT 08:48 2017 Saturday ,06 May

Climate science: Bad news gets worse
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday