Good Finance’s and E-Money Ratings are examining Hungary’s sovereign rating next week.
In its schedule for 2019, the two leading global credit rating agencies set the second review date for this year’s Hungarian sovereign rating by August 16, next Friday.
Sovereign ratings were upgraded by both companies
The Hungarian sovereign ratings were upgraded by both companies in the first tests this year.
On February 15, Good Finance’s upgraded its long-term and short-term foreign currency denominated Hungarian government debt to foreign currency denominated foreign currency denominated liabilities (BBB / A-2) from “BBB minus / A-3”. The outlook for S&P’s current Hungarian rating is stable.
One week later, on February 22, E-Money Ratings also upgraded the classification of long-term Hungarian government debt in foreign currency and forint to “BBB” from the “BBB minus”.
The outlook for E-Money’s Hungarian rating is also stable
As a result of E-Money and S&P’s move in February, only Good Credit’s Investors Service currently lists Hungary at the basic level of the investment grade category, with a rating of “Baa3”.
This rating of Good Credit’s in E-Money’s and S&P’s methodology corresponds to “BBB minus” – the former Hungarian sovereign rating of the two companies.
Thus, Good Credit’s maintains a grade lower in Hungary than the other two global rating agencies.
Prior to the February upgrades, both Good Finance’s and E-Money Ratings had a positive outlook on the rating of Hungarian sovereign debtors, but Good Credit’s Hungarian rating outlook has been stable for years.
Hungary first appeared on Good Credit’s this year’s schedule on May 3, but the company did not examine the Hungarian sovereign rating at that time, so it did not announce a change to either the Baa3 rating or its stable outlook.
Good Credit’s last announced on November 4, 2016 at the target date that it upgraded Hungary to the investment grade category, upgrading the former “Ba1” to the current stable-looking “Baa3” in Hungary.
The company did not carry out another review five times
Since then, Hungary has been on Good Credit’s schedule at six scheduled review dates. Of these, the company did not carry out another review five times, once – on November 23 last year – it confirmed the Hungarian sovereign rating and the stable outlook of the rating at the “Baa3” level that has been in force since then.
The second Hungarian review of this year is scheduled for October 25 by Good Credit’s.
Review is not mandatory at scheduled times. The European Union only requires CRAs to submit in advance when they plan to review EU sovereign debt ratings in a given year, but does not require them to carry out these reviews on designated dates.