August 21, 2012 / 10:23 AM / 5 years ago

TEXT-S&P affirms ESB 'BBB+/A-2' ratings;outlook negative

Aug 21 -

Overview

-- On Aug. 2, 2012, we affirmed our 'BBB+/A-2' long- and short-term sovereign credit ratings on the Republic of Ireland. The outlook on Ireland remains negative.

-- We are now revising upward our view of the likelihood of support for Ireland-based utility Electricity Supply Board (ESB) from the Irish government to "moderately high" from "moderate" to reflect the Irish government's announcement that it no longer intends to sell a minority stake of ESB, and that it will remain a majority shareholder in the group.

-- In accordance with our criteria on government-related entities, the above change does not affect the corporate credit ratings on ESB as long as we continue to assess its stand-alone credit profile as 'bbb+' and the sovereign rating is 'BBB+'.

-- We are therefore affirming our 'BBB+/A-2' long- and short-term corporate credit ratings on ESB.

-- The negative outlook reflects that on the sovereign and our opinion that a downgrade of the sovereign is likely to result in a downgrade of ESB.

Rating Action

On Aug. 21, 2012, Standard & Poor's Ratings Services affirmed its 'BBB+/A-2' long- and short-term corporate credit ratings and 'BBB+' senior unsecured debt rating on Ireland-based utility Electricity Supply Board (ESB). The outlook is negative.

Rationale

The affirmation follows that on the Republic of Ireland (BBB+/Negative/A-2) on Aug. 2, 2012. For further details, see "Ireland Ratings Affirmed At 'BBB+/A-2'; Outlook Remains Negative," published on RatingsDirect on the Global Credit Portal.

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