Standard Chartered has had its credit rating downgraded for the first time in 20 years, with the ratings agency Standard & Poor’s saying that the bank, which focuses on emerging markets, was going through a tough period.
The London-listed bank has issued three profit warnings in 12 months, putting pressure on its chief executive, Peter Sands, who has previously presided over consecutive years of growth - even during the banking crisis.
Until now, S&P has only ever upgraded its assessment since it first started rating Standard Chartered in 1994.
As it cut the rating from AA minus to A plus, however, the agency said the bank’s creditworthiness was weakening in comparison with its peers.
“We still consider [the bank] to be among the most creditworthy commercial banking groups globally,” S&P said. “The … group is going through a tough period of late, after many years of solid growth and strong financial performance.”
Sands and his management team spent three days earlier this month trying to assuage the concerns of investors at a series of meetings in Hong Kong. Some investors have said they are concerned that the bank might need to raise more capital.
Its shares are at five-and-a-half-year lows and were little changed after the downgrade.
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