Moody's cuts ratings of RI bonds and notes
Moody's cuts ratings of RI bonds and notes
NEW YORK (AFP): Moody's Investors Service said Friday it has downgraded Indonesia's foreign currency country ceiling for bonds and notes to B2 from Ba1 and the foreign currency bank deposit ceiling from Caa1 from Baa3.
The U.S. ratings service said the downgrades are the result of "rising concerns over the economic and financial consequences of continued turmoil and volatility in Indonesian financial markets."
It said, in particular, the Indonesian banking sector, which has a large external debt, is likely to be unable to repay a considerable portion of its obligations on a timely basis.
It said the banking system looks likely to continue to experience a rapid rise in non-performing assets, with capital flight also appearing to be a growing problem in advance of approaching presidential elections.
Moody's said it believes that its new ratings of Indonesia are appropriate given the "strong possibility" of government intervention to preserve vital exchange resources which is likely to affect timely debt repayment.
PT Bank Bali -- the rating of the bank for its long-term deposits from Ba3 to Caa1.
PT Bank Bumi Daya -- the ratings of the bank for its long-term deposits from Ba3 to Caa1.
PT Bank Dagang Nasional Indonesia -- the rating of the bank for its long-term deposits from Ba3 to Caa1.
PT Bank Dagang Negara -- the rating of the bank for its long- term deposits from Ba3 to Caa1. The bank financial strength rating of E+ remains on review for possible downgrade.
PT Bank Danamon Indonesia -- the rating of the bank for its long-term deposits from Ba3 to Caa1.
The bank financial strength rating of D remains on review for possible downgrade.
PT Bank Ekspor Impor Indonesia -- the rating of the bank for its long-term deposits from Ba3 to Caa1. The bank financial strength rating of D remains on review for possible downgrade.
PT Bank Internasional Indonesia -- the rating of the bank for its long-term deposits from Ba3 to Caa1.
PT Bank Negara Indonesia, Tbk -- the ratings of the bank for its long-term deposits from Ba3 to Caa1, and for its long-term senior debt from Ba1 to B2. The bank financial strength rating of D+ remains on review for possible downgrade.
PT Bank Pembangunan Indonesia -- the ratings of the bank for its long-term deposits from Ba3 to Caa1, and for its long-term senior debt from Ba1 to B2.
PT Bank Rakyat Indonesia -- the ratings of the bank for its long-term deposits from Ba3 to Caa1, and for its long-term senior debt from Ba1 to B2. The bank financial strength rating of E+ remains on review for possible downgrade.
PT Bank Tabungan Negara -- the ratings of the bank for its long-term deposits from Ba3 to Caa1, and for its long-term senior debt from Ba1 to B2. The bank financial strength rating of D+ remains on review for possible downgrade.
PT Panin Bank -- the rating of the bank for its long-term deposits from Ba3 to Caa1.
Meanwhile, Standard and Poor's Corp said Friday it has lowered its long-term foreign currency rating for Indonesia to BB from BB+ and its local currency ratings to BBB from BBB+.
The U.S. ratings service said the downgrades reflect "mixed symbols from the Soeharto government regarding its commitment to the economic reforms that are essential to stabilizing the crisis of confidence and containing the recent acceleration of capital (including depositor) outflows."
"The government will be challenged to implement financial sector and other structural reforms in a deteriorating financial and economic environment," Standard and Poor's said.