20150112-穆迪服务-Credit_Outlook_Credit_lmplications_of_Current_Events_42页_1mb

Credit Outlook Summary

Core Content

This document provides a comprehensive analysis of credit implications from various current events across different sectors and regions, including corporates, banks, insurers, asset managers, sovereigns, and sub-sovereigns. It highlights credit positive and negative developments, along with rating changes and research highlights, to assess the financial health and creditworthiness of entities involved.

Main Points

Corporates

• Impax Laboratories Inc. received FDA approval for Rytary, a new Parkinson's drug, which is a credit positive. However, the company's rating and outlook remain unchanged due to ongoing regulatory issues and the time required for Rytary to significantly impact cash flow.
• Coach Inc. announced the acquisition of Stuart Weitzman, which is expected to be immediately accretive to earnings and maintain leverage below 2x, a credit positive. The acquisition is part of a broader strategy to enhance brand offerings and international presence.
• Macy's and J.C. Penney reported strong holiday sales, which are credit positive. This supports the view that retail sales will benefit from employment growth and lower gas prices. J.C. Penney's turnaround strategy is showing early signs of success, but its capital structure remains a concern.
• Linn Energy and Breitburn cut distributions and capital spending to protect credit quality. These cuts are a response to weaker oil prices and are expected to ease cash needs, though the companies will still face commodity price risk and asset depletion.
• MeadWestvaco plans to spin off its chemical business, which is a credit negative due to reduced scale and increased leverage. The spin-off may allow the company to maintain an investment-grade rating, but the focus on returning cash to shareholders is a concern.

Banks

• Peru's de-dollarization measures are credit positive for banks. These measures aim to reduce exposure to foreign currency risks and encourage local currency lending, which should support profitability and credit expansion.
• Santander's €7.5 billion capital increase is credit positive, as it increases the bank's capital buffer and aligns its capital ratios with European peers.

Insurers

• FHA premium cuts are credit negative for US private mortgage insurers, as they reduce the profitability and financial stability of these entities.

Asset Managers

• Illinois' savings initiative is credit positive for target-date fund managers, as it provides more stable funding sources and supports long-term investment strategies.

Sovereigns

• Dominican Republic's fast growth supports a rising debt burden, indicating a positive outlook for its credit profile.
• Egypt's parliamentary election dates are a credit positive step in its political roadmap, suggesting stability and progress.
• Macao's gaming revenue decline is credit negative for the government, as it impacts tax revenue and economic stability.

Sub-sovereigns

• Alberta, Canada's deficits are expected to grow due to slumping oil prices, which is a credit negative.
• China's pilot bond program for regional and local governments is credit positive, as it aims to improve fiscal transparency and creditworthiness.

US Public Finance

• Burlington, Vermont received a credit-positive dismissal of its municipal broadband lawsuit, which should ease financial pressures.
• The Federal Government's $1 billion grant for Massachusetts light-rail project is credit positive, as it supports infrastructure development and economic growth.

Key Information

• Rating Changes:
  • Downgraded: Tesco, Tatra banka, Partners Healthcare System
  • Upgraded: Bank of Ireland, five tranches of CNH Capital agriculture and construction equipment ABS
• Research Highlights:
  • Covered global oil and gas, oil & gas bond covenants, US packaging, US building materials, Atlanta, US utilities, Japanese banks, Korean banks, and Ocwen Financial.
• Recent Articles:
  • The document references recent articles from the previous Thursday's Credit Outlook, available for further reading.
  • A link to the Weekly Market Outlook is provided, which contains Moody's Analytics' market analysis and financial predictions.

Conclusion

The document outlines a mix of credit positive and negative developments across various sectors and regions. While some companies and regions are showing resilience and strategic moves that support their credit profiles, others face challenges due to economic and regulatory factors. The analysis provides insights into the financial implications of these events, offering a detailed view of creditworthiness trends.