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ARCHIVE | Criteria | Corporates | Project Finance: European Railways And State Support: Company Ratings Tend To Track Governments Oct 01
Standard & Poors, Oct 2001
Abstract
Government-owned or -supported rail entities are often rated higher than their financial performance and stand-alone credit quality would warrant. The key rating question is whether to give the stand-alone ratings any boost for government support. Recently updated Standard & Poor's criteria identify three broad categories of enterprises, and the degree of government support that can be factored into the stand-alone rating in each category. (Please see 'Revised Rating Methodology for Government-Supported Entities' on Standard & Poor's on-line credit-research service, RatingsDirect, June 5, 2001.) The first category includes rail entities that are highly integrated into the mechanisms of government, important to national transportation policy, and extremely unlikely to be privatized--even in the long run--given the nature of their activity, as well...
Companies mentioned in this report are: Societe Nationale des Chemins de Fer Francais,Societe Nationale des Chemins de Fer Belges Holding,NS Groep N.V.,Railtrack PLC,Reseau Ferre de France,Deutsche Bahn AG
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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