SYDNEY, May 2 (Reuters) - The credit worthiness AMP Ltd is at risk of being downgraded, S&P Global said on Wednesday, as the reputation of Australia’s largest-listed wealth manager gets savaged by a country-wide inquiry into financial sector misconduct.
S&P said it would lower AMP’s ‘A’ rating by a notch to ‘A-‘ if damaging revelations of misconduct at the Royal Commission were to impact the firm’s core wealth management business or if the risk of fines and legal actions increased materially.
The CEO and chairwoman of AMP have resigned over the past few weeks in the wake of disclosures at the inquiry that AMP misappropriated funds of thousands of clients over the last decade by charging them without providing advice, and that it had repeatedly lied to the corporate regulator.
“We believe that the group’s prospective competitive position may be at risk of weakening following the damage to its brand and reputation,” S&P Global said in an emailed statement. (Reporting by Paulina Duran; Editing by Himani Sarkar)