Rating affirmations for some

Moody's commented on the fiscal 2009 results of both BHP Billiton and Telstra. In the case of the former, it observed that the results were broadly within expectations and held no implications for the 'A1/P1' ratings assigned.

It was noted the ratings are unlikely to experience a positive trend, considering the uncertain operating environment, BHP Billiton's anticipated financial profile, and its desire to manage its capital within a solid 'A' rating. On the other hand, the ratings could be downgraded if there is a material worsening in the operating environment and/or if there are aggressive capital initiatives.

On Telstra, its annual results were also in line with expectations but the outlook on the 'A2' rating assigned remains negative. Moody's said: "The risk flowing from the company's major transformation has receded to a significant extent.  However, the negative outlook continues to capture meaningful uncertainty for the company including the likelihood of increased regulatory controls, possible forced divestitures and evolving financial policies." The outlook could stabilise once regulatory certainty is obtained, accompanied by greater clarity from the company with respect to its future financial policies.   

Fitch affirmed the 'AA/Stable/F1+' issuer default ratings and 'B' individual rating assigned to nab. The rating affirmations reflect the group's sound capital position and solid profitability, which provide a buffer against further asset quality deterioration and higher impairment charges.

On a pro-forma basis (following an institutional share placement of A$2 billion completed in July 2009) the group's tier one capital ratio was 8.8 per cent at 30 June 2009. nab is in the process of raising up to an additional A$750 million in ordinary equity from retail shareholders which, on Fitch's calculations, could increase the group's tier one capital ratio by a further 21  bps.