Global banks have turned more cautious towards the UK as a potentially economically disruptive vote on EU membership looms in June, according to a rating agency
Credit Benchmark, an agency that aggregates the internal lending risk assessments of big international banks and uses them to devise ratings, said that lenders had turned slightly more cautious towards the UK earlier this year.
Although it cannot determine whether the more circumspect assessment of the UK’s creditworthiness was directly triggered by mounting concerns over the UK’s future in the EU, the cut came after Boris Johnson, until last week mayor of London, came out in favour of “Brexit” in February.
“We’ve also seen the risks trend higher for UK companies, so it seems reasonable to conclude that it’s being driven by concerns over Brexit,” said David Carruthers, head of research at Credit Benchmark. Nine banks, primarily US and European lenders, report to the agency on their assessment of the UK’s creditworthiness.
The UK rating implied by Credit Benchmark’s data fell one notch to “Aa” in March. That is two notches below the rating assigned by Standard & Poor’s, and one below those of Moody’s and Fitch, but the three major credit rating agencies have all warned of the potential economic fallout from a vote to exit the EU. [...]
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