S&P changes Provident Funding view

S&P said it revised its outlook on Provident Funding Associates LP to negative from stable.

The agency also affirmed the B long-term issuer credit rating on the company.

At the same time, S&P affirmed the B+ debt rating and the 2 recovery rating on Provident's $325 million senior unsecured notes due 2025. The 2 recovery rating indicates an expectation for substantial (70%-90%) recovery in the event of payment default.

The agency said the revision reflects Provident's weakening leverage over the past several years.

“Debt to tangible equity has risen above 2.0x, our previous threshold for a downgrade. Moreover, other credit metrics such as debt to EBITDA and EBITDA coverage of interest have deteriorated,” S&P said in a news release.

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