Fitch Ratings has placed Eqdom's National Long-Term Rating of 'AA+(mar)' and National Short-Term Rating of 'F1+(mar)' on Rating Watch Negative (RWN).
The RWN follows the announcement by
The sale is subject to regulatory approvals including from
The RWN on Eqdom's National Ratings reflects Fitch's expectation that upon completion of the sale the agency will cease to factor in SG's support in SGMB's ratings, which would result in a downgrade of SGMB's National Ratings and consequently of Eqdom's National Ratings. We expect to continue to maintain a notch difference between SGMB's National Ratings and Eqdom's.
We will resolve the RWN once the transaction is concluded and we have a clear view of the company's financial, business and risk profile after the sale.
Key Rating Drivers
Eqdom's ratings are based on potential support from SGMB and currently ultimately SG. SGMB uses Eqdom as its centralised consumer finance platform in
Eqdom's Standalone Credit Profile is below the company's support-driven credit profile.
The Key Rating drivers are as outlined in the rating action commentary published on
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
Eqdom National Ratings could be downgraded if SGMB's National Ratings are downgraded after the transaction execution.
If the transaction fails to close, we could affirm Eqdom's ratings if SGMB's ratings remain at their current levels.
Eqdom's ratings could also be downgraded if Fitch takes the view that Eqdom's role for, relevance to, and integration with SGMB have diminished.
The resolution of the RWN could extend beyond the typical six months if the transaction is not completed by the end of it.
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
An upgrade of Eqdom's National Ratings is unlikely given the RWN.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
Public Ratings with Credit Linkage to other ratings
Eqdom's ratings are linked to the ratings of its parent, SGMB.
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