DBRS downgrades Barclays

DBRS said it downgraded Barclays Bank plc’s issuer rating and long-term debt rating to A, short-term debt and deposit rating to R-1 (low), as well as subordinated debt rating and hybrid capital securities rating to BBB (high).

The preference shares rating was downgraded to BBB and reserve capital instruments rating to BBB (high).

The long-term and short-term critical obligations ratings were downgraded to AA (low) and R-1 (middle), respectively.

Concurrently, DBRS assigned a long-term deposits rating of A to Barclays Bank and issuer rating and long-term senior debt ratings of A (low) and a short-term debt rating of R-1 (low) to Barclays plc.

The trend is stable.

DBRS said the downgrade takes into account the challenges Barclays has faced in generating solid and stable statutory earnings as a result of substantial conduct and litigation expenses, restructuring and Non-Core exits.

In the agency’s opinion, despite a decline in litigation and conduct expenses in 2016, conduct-related risks remain significant, due to a relatively high number of outstanding conduct-related investigations and litigations.

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