S&P downgrades outlook of Croatian's state-owned bank
2013-08-07 18:05:27
International ratings agency Standard & Poor's (S&P) downgraded on Tuesday the outlook of state-owned Croatian Bank for Reconstruction and Development (HBOR) to "negative" from "stable".
S&P also affirmed its long-and short-term credit ratings at BB+/B.
"The negative outlook on HBOR reflects the outlook on Croatia. We could lower the ratings or revise the outlook on HBOR if we lowered the sovereign ratings for Croatia or revised its outlook," S&P said in a statement.
S&P on Friday affirmed the long-and short-term BB+/B sovereign credit ratings for Croatia, but revised the outlook to "negative" from "stable".
Commenting on the downgrade, Croatian Economy Minister Ivan Vrdoljak on Tuesday said private investments and fiscal consolidation was a way out of the crisis.
Finance Minister Slavko Linic, meanwhile, noted the downgrade was "a message" for the government to speed up structural reforms of the state-owned companies.
Croatia's economy has either been in recession or stagnated for the past four years. S&P forecast a 1.0 percent contraction for 2013.
International financial institutions repeatedly warned of a possible financial deterioration in Croatia, the newest member of the European Union.