Liberty Financial requests withdrawal of servicer ratings

In what is clearly a sign of the times, Moody's announced on Friday that it had been asked by Liberty Financial Pty Ltd., to withdraw its primary and special Servicer Quality ratings. Liberty Financial is an originator and servicer of non-conforming residential mortgages.

An adverse aviation environment and an inability to meet target credit metrics over the next two to three years, has resulted in Standard & Poor's lowering its long- and short-term credit rating assigned to Auckland International Airport to 'A-/A-2' from 'A/A-1'. The rating outlook is stable.

A sustained and significant underperformance in passenger traffic could put negative pressure on the rating, but this is considered unlikely, said S&P.

According to our records, Auckland International Airport has NZ$480 million of bonds outstanding in its domestic market.

Redbank Project and its debt repackaging vehicle, RB Pass Through Pty Ltd., have again had their credit ratings lowered by S&P to 'CCC+' from 'B' and the ratings remain on CreditWatch with negative implications. The rating downgrades reflect the Redbank project's weak liquidity and the power plant's history of, and risk of, continued poor and unstable operations.  Moreover, in S&P's opinion, liquidity may be affected in the short term by the potential review in June of Redbank's liquidity facilities by the project's lenders and any subsequent changes to these facilities.  

The CreditWatch could be resolved and the rating could revert to a stable outlook if Redbank refinances its liquidity facilities at terms and conditions no worse than its existing facilities. But if the lenders withdraw or reduce Redbank's liquidity facilities or introduce more onerous terms and conditions, including pricing, another rating downgrade is likely.

RB Pass Through has issued $170 million of July 2023 bonds. The bonds were credit wrapped by XL Capital Assurance.

S&P has again placed Goodman Group's 'BBB' long-term credit rating on CreditWatch with negative implications. S&P last did this in early March before lowering the then 'BBB+' rating by one notch.

S&P remains concerned about the group's lack of access to capital in debt markets and in equity markets, as reflected in Goodman's weak stapled security price. However, S&P acknowledges that management is currently in discussions with potential strategic investors.

Perhaps this action is intended to spur a successful conclusion to these discussions but let's hope it doesn't scare the potential strategic investors off. S&P will assess progress with the discussions over the next three months before resolving the CreditWatch.

The reporting of poor annual results by Investec Bank (Australia) in its Australian business last week prompted Moody's to place it on review for possible downgrade.

Moody's is concerned about a significant increase in impaired assets and weaker earnings. The review will encompass the 'Baa1', 'Baa2', 'P-2' and 'C' senior, subordinated, short-term and bank financial strength ratings assigned to the bank.

The review will focus on assessing the potential for further impairment, as well as initiatives the bank is adopting to adjust to a more stable business model. Investec Bank (Australia)'s deposit and debt ratings will depend on its BFSR, which measures the bank's stand-alone credit profile. As Investec Bank (Australia) is currently rated higher than its parent, Investec Bank plc (rated Baa3), there is no uplift to its baseline credit assessment of Baa1.

The bank relies heavily on wholesale funding for its operations in Australia. It has $600 million of government guaranteed bonds outstanding in the domestic market and $100 million and $150 million of June 2010 and June 2012 non-guaranteed bonds.