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S&P: Aeon Credit view negative
Standard & Poor's said it today revised the outlook on Aeon Credit Service (Asia) Co. Ltd. to negative from stable and affirmed its A- long-term and A-2 short-term counterparty credit ratings.
The outlook revision reflects expectation that parent Aeon Credit Service Co. Ltd. will experience increased credit costs, including repayment of overpaid interest, as well as weaker revenue from its loan business in Japan, according to the agency.
"While the weakness of ACS's domestic loan business is mitigated by its growing credit card business and overseas operations, we expect the pressure on its asset quality will likely persist given Japan's current stagnant economy and uncertainty concerning the expected implementation of the revised Money Lending Business Law (by June 2010), which limits the total lending balance per borrower and cuts legal loan ceiling rates," S&P analyst Terry Sham said in a statement.
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