The Standard & Poor's Ratings Services has placed its 'A+' long-term counter-party credit rating on Bank of Ireland.
In a statement, S&P explained its decision was prompted by BoI's first half results which S&P said 'clearly suggest a faster and deeper deterioration in the bank's asset quality than we had previously expected'.
S&P believes that the bank may just maintain a profit for its business year ending March 31, but expects it to face 'a similar earnings challenge in the following financial year'.
Bank of Ireland yesterday reported underlying pre-tax profits of €650m for the six months to the end of September, a drop of 32% from a year earlier.
Commenting on the results, BoI chief executive Brian Goggin said that the bank was a 'strong, sound and successful' business and did not see the need to raise additional capital at the moment.
He said only €13 billion, or less than 10% of its total loan portfolio, linked to property development, was causing the bank problems.
Bank of Ireland has signed up for the Government’s guarantee scheme, which S&P believes will lead to 'increased government control and regulatory oversight' and will affect future earnings.
