Moodyʼs review for FHB downgrade covered bonds


Moodyʼs Investors Service has placed on review for downgrade the Ba1 assigned to the covered bonds issued by FHB Mortgage Bank, the ratings agency said in a press release late yesterday. Moodyʼs said it determines covered bond ratings using a two-step process: an expected loss analysis and a TPI framework analysis. Observers have said the bank is being targeted because its chairman owns media outlets that criticize the government.

The bonds are rated Ba1 by Moodyʼs. On Tuesday Moody’s said FHB mortgage bank came under review for a downgrade due to negative publicity as well as government actions against FHB bank. 

Moody’s Covered Bond Model (COBOL) to determine a rating based on the expected loss on the bond “determines expected loss as (1) a function of the probability that the issuer will cease making payments under the covered bonds (a CB anchor event); and (2) the stressed losses on the cover pool assets following a CB anchor event”, the statement said.

“Q multiple-notch downgrade of the covered bonds might occur in certain circumstances, such as (1) a country ceiling or sovereign downgrade capping a covered bond rating or negatively affecting the CB Anchor and the TPI; (2) a multiple-notch downgrade of the CB Anchor; or (3) a material reduction of the value of the cover pool,” the statement by Moody’s said.


CIG Pannónia Board Proposes HUF 18-per-share Dividend Figures

CIG Pannónia Board Proposes HUF 18-per-share Dividend

Hungarian Lawmakers Ratify Finland's NATO Accession Parliament

Hungarian Lawmakers Ratify Finland's NATO Accession

IBS Reaches 50-50% Gender Ratio in Management HR

IBS Reaches 50-50% Gender Ratio in Management

Sümeg Castle Reopens History

Sümeg Castle Reopens


Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.