Ireland’s deal on the Anglo Irish Bank promissory notes is a “positive surprise”, according to ratings agency Fitch, however it will not lead to any change in the country’s rating in the short-term.
The agency said the agreement to replace the notes with bonds will reduce Ireland's financing needs, ease fiscal pressure and make the country’s public finances more transparent.
However it said it would have a “limited impact on Ireland’s debt stock” and would “not affect Ireland’s public debt dynamics sufficiently” to see a ratings change.
Fitch said it revised its outlook on Ireland’s BBB+ rating from “negative” to “stable” in November 2012 but outlined a number of risks including the need for further readjustment and the week growth outlook.
It said those risks still apply despite yesterday’s deal.
Fitch did note that, as a result of the promissory note deal, Ireland will now have one of the highest average maturity profiles amongst the countries it rates.
It also noted that the country’s deficit should be reduced by 0.6% of GDP as a consequence of the new arrangement.