S&P turns IIB outlook to negative

S&P said it revised its outlook on the International Investment Bank to negative from stable and affirmed its A- long-term foreign- and local-currency ratings.

“The negative outlook reflects the risks of a material erosion of the IIB's shareholder base due to the announced withdrawal of several key shareholders. If executed, we believe the reduced shareholder base will severely hit the bank's policy role, raising concerns regarding institutional depth and requiring significant changes to its fundamental strategy to avoid depleting policy relevance. These components carry significant negative risks to our enterprise risk profile assessment for the bank,” S&P said in a press release.

Bulgaria, the Czech Republic, Romania and Slovakia announced their plans to withdraw.

The agency warned the withdrawals could happen within the next 12 months and could lead to a multi-notch downgrade.

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