S&P downgrades IL&P and Anglo
RATINGS agency Standard & Poor's last night downgraded Irish Life & Permanent's debt to junk and cut Anglo Irish Bank's credit rating, despite describing the latest banking bailout as "credible".
The latest dispatch comes four days after S&P cut the Irish sovereign's credit rating, citing concerns about the weight of a potential €24bn bailout on national finances.
In a detailed note on the banks themselves, S&P praised elements of the banking rescue but said that "it will likely be many years before the Irish banking system starts to approach the creditworthiness of peer European systems".
S&P have downgraded IL&P's debt one notch to junk, "to reflect the fact that we no longer factor support from the life operations" into the plc's debt, since Irish Life Assurance is set to be hived off for its own flotation this summer.
Anglo Irish Bank's main 'counterparty' rating has dipped one notch to CCC+, with S&P pointing out that the bank is of "limited importance".
AIB, Bank of Ireland and IL&P remain on "negative rating watch", implying future downgrades are possible, as do Ulster Bank and KBC.