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Tuesday 14 August 2018

BoI faces cut in its credit rating

BANK of Ireland could face a credit rating cut as Standard & Poor's downgraded its outlook from "stable" to "negative". The bank's €3.5bn capital-raising earlier this year was praised by S&P, which affirmed the bank's "A-" credit rating, but the ratings agency cited fears that the bank's recovery will be dragged down by the wider economy's woes.

The bank's €3.5bn capital-raising earlier this year was praised by S&P, which affirmed the bank's "A-" credit rating, but the ratings agency cited fears that the bank's recovery will be dragged down by the wider economy's woes.

S&P said it faced "considerable challenges" to restoring its credit profile. Those challenges include the prospect of the Irish economy recovering "quite slowly" and the "consequent challenge that BoI faces to restore profitability".

The agency said it expected that the bank would be successful in restoring its current "BB+" stand-alone credit profile to the "A-" rating level as its financial profile strengthens.

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