After seeing their rating plummet to “BB-”, impacted by South Africa’s “BB” sovereign rating from “BB-” in November, five South African banks have just received the excellent rating “ AA + ”from the rating agency Fitch Ratings. They are Absa Bank Limited, FirstRand Bank Limited, Investec Bank Limited, Nedbank Limited and The Standard Bank of South Africa Limited.
This long-term national rating, backed by a stable outlook, reflects an improvement in their creditworthiness compared to the best credits in the country, according to Fitch. Debt ratings were also upgraded a notch.
Fitch has also taken similar rating action on the long-term national ratings of four South African bank holding companies, namely Absa Group Limited, Investec Limited, Nedbank Group Limited and Standard Bank Group Limited.
On this review, Fitch says the creditworthiness of South African banks has improved against the best credit in the country, including sovereign and government-linked entities. In addition to sovereign risks, Fitch believes that banks have significant leeway to withstand current pressures on the operating environment.
