Prompted by their FrAAAnce downgrade to AA+, French-owned Fitch has downgraded Europe’s last best promise/hope – the EFSF – from AAA to AA+… but the crisis is still behind us – we are assure by such truth-sayers as Juncker, Barroso, and Merkel (pre-elections).
Fitch Ratings-London-15 July 2013: Fitch Ratings has downgraded the European Financial Stability Facility’s (EFSF) guaranteed and long-term debt Long-term rating to ‘AA+’ from ‘AAA’. The EFSF’s short-term (less than 12 months contractual maturity) guaranteed debt instruments’ Short-term rating has been affirmed at ‘F1+’.
KEY RATING DRIVERS
The rating actions were prompted by Fitch’s downgrade of France’s Long-term Issuer Default Ratings (IDRs) to ‘AA+’/Stable and the affirmation of its Short-term rating at ‘F1+’ on 12 July 2013. EFSF’s ratings rely on the irrevocable and unconditional guarantees and over-guarantees provided by euro areas member states (EAMS). These commitments are governed by an international agreement dated in June 2012 by the 17 EAMS – the EFSF Framework Agreement (FA) – and by a Deed of Guarantee. The downgrade of France’s IDR had a high weight in Fitch’s rating actions.