Johannesburg – S&P has downgraded Eskom’s credit rating, dropping it from the lowest level of junk to “highly speculative”, with a negative outlook.
This rating review follows its Monday’s announcement that it was cutting SA to junk – the first rating agency to do so.
Moody’s has placed SA’s sovereign rating – two levels above junk – and Eskom’s rating on review as well. It may release a decision today. Fitch, the other big three rating house, yes yet to make a statement about SA, which it has a level above junk.
Companies cannot have a rating higher than that of a country.
In a statement released late on Thursday, S&P cited the deep divisions in the African National Congress-led government that have led to changes in the executive leadership of government, which may weaken political and institutional stability.