Fitch downgrades South African banks

Fitch Ratings said it downgraded the long-term foreign and local currency issuer default ratings of FirstRand Bank Ltd., Nedbank Ltd. and Standard Bank of South Africa Ltd. and the respective rated holding companies of the last two banks to BBB- from BBB.

The actions follow the Dec. 4 downgrade of South Africa's sovereign rating to BBB-/stable.

Fitch also downgraded Absa Bank Ltd.’s and Barclays Africa Group Ltd.’s long-term foreign and local currency issuer default ratings to BBB and BBB+, respectively, from A- as a result of South Africa's country ceiling being revised to BBB.

The viability ratings of FirstRand, Absa Bank, Barclays Africa, Nedbank, Nedbank Group Ltd., Standard Bank Group Ltd. and Standard Bank of South Africa were downgraded to bbb- from bbb, reflecting their concentration to South Africa, large holdings of government securities, high exposure to sovereign-owned enterprises and the weakening economic and operating environment, as indicated by the sovereign downgrade. The national ratings were affirmed.

Investec Bank Ltd. and Investec Ltd.’s issuer default ratings and viability ratings were affirmed at BBB- and bbb-, respectively. Their national ratings were upgraded as Fitch believes that their creditworthiness relative to other credits in the country has improved in the downturn owing to a more resilient risk profile.

All outlooks are stable.

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