Israeli Finance Minister Silvan Shalom headed for London on Monday for an urgent meeting with rating agency representatives in a bid to halt the possible downgrade of the nation’s sovereign credit rating.
The move came after agencies Standard & Poor's and Fitch notified the Ministry on Sunday that they were considering downgrading Israel’s rating. The possibility of a US military campaign against Iraq and its effects on the Israeli economy were the main factors behind the rating alert.
Shalom will defend Israel’s position by emphasizing the country's long-standing practice of repaying its debts. Standard & Poor's already lowered its ratings on Israel's three largest financial institutions—Bank Hapoalim, Bank Leumi and Israel Discount last month. The move was mainly attributed to the negative impact of the economic recession on the local banking sector.
In June, Fitch downgraded the First International Bank of Israel's (FIBI) long-term rating to BBB+ from A- and its individual rating to C/D from C. The outlook was changed to stable from negative. — (menareport.com)
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