DBRS may cut South Financial to junk

DBRS said it placed the long- and short-term ratings of South Financial Group, Inc. and its related entities, including South Financial's issuer and senior debt ratings of BBB (low), under review with negative implications.

The agency said the review will focus on South Financial's ability to cope with its continued asset quality deterioration. Over the past year, the company has faced elevated credit costs and lack of profitability due to its weakened Florida commercial real estate portfolio, DBRS said.

Positively, South Financial's has been able to convert roughly $60 million of its $250 million mandatorily convertible preferred stock into common shares, which the agency said enhanced its capital position and loss absorption capacity.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.