RATING AGENCIES (FINANCE)

Victoria turns blind eye to credit downgrade risk

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Original article by Lily McCaffrey
The Australian – Page: 6 : 4-Jun-25

Victoria’s Treasurer Jaclyn Symes will hold meetings with global credit ratings agencies in New York on Friday. Symes has told parliament’s public accounts and estimates committee that there has been no indication from the ratings agencies that Victoria’s credit rating may be subject to an unfavourable review. The issue came under scrutiny earlier in 2025 when S&P Global warned that the government must demonstrate "fiscal discipline" if it hopes to retain the state’s AA/Stable credit rating, which had been downgraded from triple-A in 2020. The Treasury has advised that it has not undertaken any modelling on the impact of a further credit rating downgrade on the state’s budget position.

CORPORATES
VICTORIA. DEPT OF TRANSPORT, S&P GLOBAL RATINGS

Government debt could hit $1trn by September

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Original article by Michael Read
The Australian Financial Review – Page: 4 : 8-May-25

Data from the Australian Office of Financial Management shows that the federal government’s gross debt is currently about $929bn. Micaela Fuchila, the chief economist at investment bank Jarden, has forecast that the nation’s gross debt will reach $1trn in either September or October of this year. The Treasury in turn expects the government’s net debt – which excludes the value of financial assets such as the Future Fund – to reach $556bn by June. S&P Global recently warned that Australia’s coveted AAA credit rating may be at risk if federal election spending promises are funded via debt rather than revenue or cost savings.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY. OFFICE OF FINANCIAL MANAGEMENT, JARDEN AND COMPANY, S&P GLOBAL INCORPORATED

Chalmers stakes future on staying AAA

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Original article by Greg Brown, Matthew Cranston
The Australian – Page: 1 & 6 : 30-Apr-25

Treasurer Jim Chalmers has downplayed concerns that Australia’s coveted ‘AAA’ credit rating may be downgraded. S&P Global has warned of this possibility due to election campaign promises and the growing use of so-called ‘off-budget’ spending. Chalmers says the federal govermment respects the global ratings agency and concedes that its "opinion matters". However, he adds that Labor’s "responsible economic management" means there would be no reason for a credit rating downgrade if it retains office on Saturday. The Australian Chamber of Commerce & Industry’s CEO Andrew McKellar says the S&P report is a "wake-up call" for both of the major political parties, and that budget repair must be a priority for the next government.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, S&P GLOBAL INCORPORATED, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY

PM scores AAA for denial

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Original article by Greg Brown, Matthew Cranston
The Australian – Page: 1 & 6 : 29-Apr-25

S&P Global has warned that Australia’s coveted ‘AAA’ credit rating is at risk due to the erosion of "sound fiscal management". The firm has raised concern about how the major political parties will fund their election promises if they win the election on 3 May, noting that the budget deficit could widen if the election promises are not funded via revenue or cost savings. S&P also expressed concern about the growing use of so-called ‘off-budget’ spending. However, Prime Minister Anthony Albanese has rejected suggestions that Australia could face a credit rating downgrade, while Treasurer Jim Chalmers says Opposition leader Peter Dutton and the Coalition are the biggest risk to the nation’s credit rating.

CORPORATES
S&P GLOBAL RATINGS, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY

S&P loses patience, warns of state downgrades

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Original article by Michael Read, Jonathan Shapiro
The Australian Financial Review – Page: 3 : 5-Feb-25

A report from S&P Global Ratings has concluded that the expenditure of Australia’s state and territory governments was $212bn higher between 2020 and 2023 than had been forecast in their 2019 budgets. This significantly offset the $146bn in revenue over the same four-year period. S&P forecasts that the combined debt of the states and territories will top $780bn by 2027, and the firm has warned they may face credit ratings downgrades unless action is taken to rein in spending.

CORPORATES
S&P GLOBAL RATINGS

Australia’s economy is in better shape than most: Fitch

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Original article by Cecile Lefort
The Australian Financial Review – Page: 26 : 24-May-23

Fitch Ratings expects the Australian economy to expand by just 1.5 per cent in 2023, slightly below the Reserve Bank’s forecast of 1.7 per cent growth. However, Fitch contends that the domestic economy is better-placed than most developed nations to cope with rising borrowing costs and slowing economic activity; this includes the other 10 nations that still have an AAA rating from the three major rating agencies. Fitch cites a number of factors in Australia’s favour, including a high level of household savings in the wake of the pandemic, exports to China and an increase in net overseas migration in coming years.

CORPORATES
FITCH RATINGS LIMITED

Moody’s sticks to AAA rating

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Original article by John Kehoe, Phillip Coorey
The Australian Financial Review – Page: 1 & 6 : 24-Jun-20

Moody’s Investors Service expects the Australian economy to contract by five per cent in 2020 due to the impact of the coronavirus pandemic. Moody’s notes that the fall in GDP growth will be lower than many other developed nations, and it expects Australia to return to positive growth in 2021. Moody’s has also affirmed Australia’s AAA credit rating; rivals S&P Global Ratings and Fitch have previously placed the nation’s credit rating on negative outlook, but Australia is only one of 10 nations that have an AAA rating from all three agencies. Treasurer Josh Frydenberg has described this as an "expression of confidence" in the federal government’s handling of the health crisis.

CORPORATES
MOODY’S INVESTORS SERVICE INCORPORATED, S&P GLOBAL RATINGS, FITCH RATINGS LIMITED, AUSTRALIA. DEPT OF THE TREASURY

S&P pushes banks down global ranks

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Original article by Jonathan Shapiro
The Australian Financial Review – Page: 1 & 16 : 3-Oct-18

The global ranking of Australia’s major banks has fallen sharply in terms of risk adjusted capital, which is S&P Global Ratings’ preferred measure of the sector’s financial strength. The nation’s four largest banks are ranked in the 40th to 50th percentile in S&P’s latest survey of the world’s top 100 banks. The Financial System Inquiry in 2014 had recommend that the big four banks should be within the top quartile of global banks in terms of capital strength. Regaining "unquestionably strong" status would require them to raise more capital.

CORPORATES
S&P GLOBAL RATINGS, CITIGROUP PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, BANK FOR INTERNATIONAL SETTLEMENTS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

BHP oil division stymies S&P upgrade

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Original article by Peter Ker
The Australian Financial Review – Page: 15 : 14-Mar-18

BHP Billiton has reduced its net debt by US10.5bn ($A13.3bn) since Standard & Poor’s downgraded its credit rating from "A+" to "A" in 2016. Although S&P has since upgraded BHP’s outlook from "negative" to "stable", analyst Elad Jelasko says a decline in BHP’s portfolio diversification has contributed to the lack of a credit rating upgrade. He notes that the downturn in earnings from BHP’s petroleum division has helped to offset the positive impact of the reduction in net debt. Jelasko adds that the proposed sale of BHP’s US shale assets is unlikely to affect its credit rating.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, STANDARD AND POOR’S FINANCIAL SERVICES LLC, RIO TINTO LIMITED – ASX RIO, SAMARCO MINERACAO SA

Moody’s trims bank ratings on rising debt

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Original article by Michael Roddan
The Australian – Page: 21 : 20-Jun-17

Moody’s has lowered its credit ratings for Australia’s four major banks, along with eight other smaller banks. Among the smaller banks to have their ratings downgraded are Bendigo & Adelaide Bank, ME Bank, Heritage Bank and Credit Union Australia. Francesco Mirenzi of Moody’s said the downgrades were prompted by concerns over high household debt and the possibility of a correction in the housing market.

CORPORATES
MOODY’S INVESTORS SERVICE INCORPORATED, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, MEMBERS EQUITY BANK PTY LTD, HERITAGE BANK LIMITED – ASX HBS, CREDIT UNION AUSTRALIA LIMITED, STANDARD AND POOR’S (AUSTRALIA) PTY LTD, BANK OF QUEENSLAND LIMITED – ASX BOQ, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NEWCASTLE PERMANENT BUILDING SOCIETY LIMITED, TEACHERS MUTUAL BANK LIMITED, QT MUTUAL, TEACHERS MUTUAL VICTORIA