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Moody’s downgrades covered bond programs

Moody’s Investors Service has downgraded the following Hungarian covered bond programs, the agency said in a press release.

Mortgage covered bonds issued by FHB were downgraded to ‘A3’ from ‘Aa3’ and placed on review for possible downgrade, mortgage covered bonds issued by OTP Mortgage Bank were downgraded to ‘Aa2’ from ‘Aa1’ and placed on review for possible downgrade, while those issued by Unicredit were downgraded to ‘A1’ from ‘Aa3’ and placed on review for possible downgrade.

Moody’s said that the downgrades were prompted by a combination of the weakening economic environment in Hungary and the exposure of covered bondholders to both significant refinancing risk and foreign denominated liabilities. The ratings have also been placed on review for possible further downgrade as Moody’s is reviewing the underlying issuers for possible downgrade. (MTI-Econews)