ASB has credit rating downgraded, but says no reason for panic

Global ratings agency Standard & Poor’s dropped ANZ, BNZ and Westpac’s A- rating to a BBB+ rating, while ASB’s rating was cut from A to A-.

The standalone ratings do not take into account the support of the banks’ Australian parent companies.

On an overall basis, their ratings were unchanged at AA-, with a stable outlook.

The downgrades were made on the basis that New Zealand’s economic imbalances have created heightened risks in the last three years.

“In particular, we believe that the rapid rise in house prices in Auckland during this period has amplified the risk of a sharp correction in property prices,” Standard & Poor’s said.

While unlikely, if a crash were to occur, most financial institutions would be affected, the agency said.

Everyone is just a little too obsessed with trying to convince everyone else that there is no crash looming. ? Read more »

Recession? What Recession?

The recession seems to have evaporated, or else people simply don’t care anymore.

EFTPOS provider Paymark says at the peak between midday and 1pm shoppers were ringing up 131 transactions every second.

CEO, Simon Tong, says the resulting 438,000 transactions for the hour is a record. However he says New Zealanders are continuing to spend at an amazing rate with over 100 transactions a second every hour since 10am.

Mr Tong says he expects in excess of $225 million to be spent today through EFTPOS alone, and that too will be a record.

Sounds like the recession is well and truly over.