Wednesday, December 9, 2009

Soveriegn Credit News Continues to Weigh on Euro

Moodys places UAE and Dubai GRI's on negative credit review.
DIFC, December 09, 2009 -- Moody's Investors Service has placed the ratings of government-related issuers (GRIs) in the UAE on review for possible downgrade. This includes all GRI's that are owned by either the federal UAE government, or the government of Abu Dhabi. The review was prompted by a need to re-validate, and possibly reconsider our support assumptions following Dubai's recent decision to explicitly segregate its direct obligations from those of its GRIs, following which a decision was subsequently made to pursue a debt restructuring at Dubai World.

The ratings under review currently benefit from very high implicit government support assumptions and assume that even in most potential stress scenarios the government will not make a distinction between servicing its direct obligations and those of its state-owned companies.

Issuers whose ratings were placed on review for downgrade include the following:

- Abu Dhabi National Energy Company (TAQA) issuer and debt ratings: Aa2 / on review for downgrade. The Prime-1 short term ratings were affirmed.
- Mubadala Development Company (Mubadala) issuer and debt ratings: Aa2 / on review for downgrade. The Prime-1 short term ratings were affirmed.
- Tourism Development & Investment Company (TDIC) issuer and debt ratings: Aa2 / on review for downgrade
- International Petroleum Investment Company (IPIC) issuer and debt ratings: Aa2 / on review for downgrade. The Prime-1 short term ratings were affirmed.
- Emirates Telecommunications Company (Etisalat) issuer ratings: Aa2 / on review for downgrade
- Dolphin Energy (Dolphin) long term debt rating: Aa3 / on review for downgrade
- Aldar Properties (Aldar) issuer and de


Not to mention Greece and Spain.

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