Insider Business New upgrade from Moody's

New upgrade from Moody’s

Moody’s Investors Service has upgraded the government of Cyprus’s long-term issuer rating to Ba2 from Ba3. All senior unsecured bond and programme ratings have also been upgraded to Ba2 and (P)Ba2, respectively. Cyprus’ short-term ratings have been affirmed at Not Prime (NP) and (P)NP. The outlook on Cyprus’ ratings has been changed to stable from positive.

According to Moody’s the upgrade of Cyprus’ ratings to Ba2 from Ba3 is driven by a number of factors, such us  the ongoing recovery of  the banking system, in the context of which the liquidation of Cyprus Co-operative Bank Ltd via the sale of its healthy assets and liabilities has materially reduced systemic risks emanating from the banking sector. Also from the positive fundamental trend with respect to the government”s balance sheet, based on robust nominal growth and a primary surplus, irrespective of the one-off related to the recent CCB transaction.

The stable outlook on Cyprus’ Ba2 ratings, balances Cyprus’ strong fiscal dynamics against pressures for higher public expenditure. It also reflects uncertainty around the extent to which new legal tools will enable a material decline in the banking system’s non-performing loan (NPL) ratio, it says.

Moody’s would consider changing the outlook on the Ba2 ratings to positive and eventually upgrading Cyprus’ Ba2 ratings if Moody’s were to conclude that macroeconomic conditions and policy actions were to result in a sustained and significant decline in the government debt stock and in the stock of non-performing loans in the banking sector, it adds.

Downward pressure that could lead to a negative outlook and eventually a downgrade of the rating could develop if growth or fiscal policy decisions were to cause a reversal of the supportive fundamental debt trend. A failure to translate recent legislative actions and interventions in the banking sector into a significant decline in the non-performing loan ratio would also be credit negative, Moody’s says.

Top Stories

188 new cases of COVID-19 on Thursday

The Health Ministry announced 127 new COVID-19 cases on 22 October, out of 4,304 laboratory tests, taking confirmed infections to 3,154.   The break-down of new...

Confirmed COVID-19 cases in Ygia Polyclinic

Ygia polyclinic is informing the public that due to the fact that a small number of COVID-19 cases have been found among the staff...

President Anastasiades will not resign

President Nicos Anastasiades will not betray the decision of the big majority of the citizens and will complete his term, as the Constitution and...

Citizens request the resignations of those involved in illegal passports’ case

In an announcement, organized groups of people are requesting the immediate resignation of politicians directly or indirectly involved in the issuing of Cypriot passports...

New measures announced by Health Minister due to increase in number of COVID-19 cases

Face masks must be worn outside at all times, the Cabinet decided on Thursday. Moreover, stricter measures apply in all districts and partial lockdown...

Taste

Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...

Mezedes

No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...