Moody `s: Prospects bleak Iceland
Gold Investing August 20th, 2009
An international rating agency Moody `s said, the president of Iceland refusal to approve a compensation agreement with London and The Hague in the collapse of Icesave bank country complicates the prospects of recovery.
Although Iceland is not downgraded or put on notice, as did the other ranking, Moody `s Investors Service said the move” has implications for credit is uncertain, but it would be difficult for any short-term plan (for Iceland) to get out of the economic crisis and finance. “
Earlier Wednesday, Standard & Poor `s put Iceland on negative CreditWatch amid fears of veto President Ólafur Ragnar Grímsson` s the law that Icesave depositors compensation for English and Dutch, can strike a relationship with the International Monetary Fund.
If not, “we can lower our rating in Iceland is one to two points in a month,” said S & P.
The IMF said the decision will not affect relations with Iceland. On Tuesday, Fitch Ratings downgraded the long-term debt of Iceland from BBB-to BB +, or junk bond status (junk bond), citing “a new wave of domestic political, economic and financial uncertainties” for the country.
For its part, Moody `s says Iceland well placed to” weather the period of uncertainty while no impact on the current Baa3 rating. ” At the same time, “every indication of renewed political instability and / or serious international pressure would signal a real credit concerns and may lead to negative rating actions,” he warned. Icesave Act now subject to a referendum, expected in the coming months.
