Here are the top highlights from this week's edition of Moody's Credit Outlook:
First Reads
Bolivia's presidential election marks a shift from leftist rule as centrist Rodrigo Paz and conservative Jorge Quiroga advance to a 19 October runoff amid voter dissatisfaction with the ruling party's economic performance. The election outcome could stabilize macroeconomics but faces political challenges.
Meanwhile, Lowe's plan to acquire Foundation Building Materials for $8.8 billion will boost its PRO offerings and market position. Fully funded by debt, we expect leverage to peak at 3.5x but fall to 2.75x within 24 months, supporting Lowe’s credit stability.
Featured News and Analysis
Nexstar's TEGNA acquisition will boost leverage and face revenue pressures in broadcasting
Nexstar Media plans to acquire TEGNA for $6.2 billion in a deal that will create a leading broadcaster covering 80% of US households. The deal will be financed mostly with debt and prompted a ratings review for downgrade of Nextar’s ratings on increased leverage amid industry challenges.
Genting Berhad's potential divestment of Resorts World Catskills' non-gaming assets support deleveraging
Genting Malaysia announced the potential sale of US subsidiary Empire Resorts’ non-gaming assets. Sale proceeds would be used to repay $300 million in debt and buy land, improving Empire’s capital structure and lowering Genting Berhad debt/EBITDA.
Nedbank Group’s disposal of Ecobank stake will help refocus strategy on growth areas
South Africa-based lender Nedbank agreed to sell its 21.2% stake in Ecobank to Bosquet Investments. The sale is credit positive because it will increase Nedbank’s profitability and refocus its strategy on growth areas in Africa while optimizing capital allocation.
Credit in Depth
We look at how the recently passed US budget will increase resources for affluent households but reduce them for lower-income ones, causing divergent credit risks. Between 2026 and 2034, average household income will rise $2,105, masking a $1,200 drop for the lowest decile and $13,600 gain for the highest.
Credit conditions in China will remain steady in the second half of this year, though trade uncertainty and related policy responses remain a key risk. Policy support to improve business sentiment, stabilize growth, ease finance conditions and address economic imbalances could stabilize credit conditions overall in 2025.
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