Ireland

Moody’s downgraded mortgaged backed covered bonds issued by Anglo Irish Bank and Anglo Irish Mortgage Bank from Aa2 to A2, on review for possible downgrade, today (Monday), because of a cut to Anglo Irish’s senior unsecured rating.

Moody’s cut covered bonds issued by Anglo Irish Bank Corporation (Anglo Irish) and Anglo Irish Mortgage Bank (AIMB) from Aaa to Aa2, on review for possible downgrade, on Friday, because of concerns over the liquidity of commercial assets backing the covered bonds. Meanwhile, Fitch put AIB Mortgage Bank’s mortgage covered securities on Rating Watch Negative.

Fitch downgraded covered bonds issued by Anglo Irish Bank Corporation and Anglo Irish Mortgage Bank (AIMB) from AAA to AA+, and placed them on Rating Watch Negative, yesterday (Thursday), after downgrading the issuers from A- to BBB+ on Wednesday because of an announcement by the Irish government that Anglo Irish will be split into an asset recovery bank and a funding bank.

Standard & Poor’s yesterday (Monday) affirmed under its revised rating methodology public sector-backed covered bonds issued by Ireland’s Depfa ACS Bank at AA, on stable outlook, and removed them from CreditWatch developing.

Moody’s last Friday downgraded Asset Covered Securities issued by Depfa ACS Bank from Aa2 to Aa3 because of a downgrade in the issuer’s rating from A2 to A3.

Moody’s yesterday (Wednesday) cut Ireland’s EBS Building Society from A2 to A3, on stable outlook, after having on Monday downgraded the sovereign by one notch.

Standard & Poor’s yesterday (Monday) upgraded WestLB Covered Bond Bank (CBB) from BBB+ to AA- and lifted its outlook from negative to stable, and changed the CreditWatch on the issuer’s covered bonds from negative to developing.

Moody’s has upgraded WestLB Covered Bond Bank from A2 to Aa1 because of a change of its ownership from WestLB to Erste Abwicklungsanstalt (EAA), a wind-down entity set up for WestLB. The development is “very favourable” for bondholders, said the rating agency.

Standard & Poor’s removed 10 covered bond programmes from review after affirming their ratings at AAA on Friday, but downgraded five programmes and these remain on review. The actions were taken on the last day of a four month period by the end of which S&P said it aimed to have resolved all 98 ratings it placed on review in December after introducing a new methodology.

Standard & Poor’s yesterday (Tuesday) downgraded Allied Irish Banks, Anglo-Irish Bank and Bank of Ireland after updating its credit loss assumptions for Irish banks and lowering its risk assessment of the country’s banking industry.

Mitigating actions taken or to be taken by Ireland’s covered bond issuers mean that downgrades of the institutions’ short term issuer default ratings by Fitch last week have no impact on their covered bond ratings, the agency said on Friday.

Asset covered securities and UK covered bonds issued by members of the Anglo Irish Bank group could be cut to below Aaa, said Moody’s yesterday (Thursday), after placing on review for possible downgrade Anglo Irish Bank Corporation Limited’s issuer rating earlier this week.