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Saturday, July 27, 2013

Moody's to Review Four Banks, Energy Company for Possible Upgrade

Moody's Investors Service have placed four banks and one energy unit for possible credit rating upgrade.

The companies were identified as follows:

BDO Unibank
Metropolitan Bank and Trust Co.
Bank of the Philippine Islands
Land Bank of the Philippines
Power Sector Assets and Liabilities Management Corp (PSALM)

Moody's move comes after its announcement that the country's credit rating had been placed on review for a possible upgrade.

“The review for upgrade of BDO’s, BPI’s, LBP’s and MBT’s ratings reflect our assessment that these ratings would likely benefit from an additional notch of systemic support uplift in the event that the parallel review of the Philippine sovereign debt rating concludes with a rating upgrade,” said Simon Chen, a Moody’s assistant vice president and lead analyst for the Philippine banks. The rating agency will consider factors including the bank’s market share of system deposits and loans, and the bank’s role in the country’s payment system.

Moody’s is also considering the upgrade in the debt ratings of the government-owned Napocor and Psalm. Psalm is the agency mandated to privatize Napocor’s assets and manage its finances. It is wholly owned and controlled by the Philippine government.

No changes for PLDT

As for PLDT, Moody’s said that while they will also review the telecom company's ratings, it will not have any immediate impact on its Baa2 rating and stable outlook.
In a statement Yoshio Takahashi, a Moody’s assistant vice president and analyst, said that, “We expect PLDT [earnings before interest, tax, depreciation and amortization, or Ebitda] to maintain its strong earnings. Its adjusted consolidated Ebitda margin is likely to stay at around 50 percent, given its strong market positions in the fixed-line, broadband and cellular services businesses in the Philippines.”

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