S&P lowers Eqstra

Standard & Poor's said it lowered its long-term South Africa national-scale rating on Eqstra Holdings Ltd. to zaBBB from zaA-.

At the same time, the agency said it affirmed its zaA-2 short-term national-scale rating.

"The rating action follows material deterioration in Eqstra's profitability in 2009 (although the second half showed a positive trend, despite a loss), as well as what we view as continuing funding vulnerabilities," said S&P credit analyst Matthew Pirnie.

The national-scale ratings on Eqstra continue, in its opinion, to be supported by an adequate level of capitalization, which could improve with an expected 450 million rand capital increase in the first half of 2010, and good market position and customer franchise, the agency added.

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