MANILA -- Credit rater Standard & Poor’s (S&P) has also revised its ratings outlook on state-owned Development Bank of the Philippines (DBP) from Stable to Positive at the heels of the same decision on the sovereign Thursday.
In a statement Friday, it also affirmed the bank’s long-term issuer rating of ‘BBB’ and short-term issuer rating of 'A-2' after citing the possibility that “the government will provide timely and sufficient extraordinary support to DBP if needed.”
It explained that the bank plays a big part in boosting the government’s bid to further uplift the country’s economic and social development through financing of critical industries as well as infrastructure programs of local governments, water districts and cooperatives, among others.
“Our assessment of government support reflects the history of capital support and sovereign guarantees by the government for DBP's external borrowing,” it said.
S&P explained that “DBP undertakes a wide range of projects that cannot be pursued on a commercial basis.”
Thus, it is confident that the bank “will sustain its public policy role over the next two years.”
“Any significant change in government policy that affects DBP's critical role or integral link would affect the rating on the bank, but that's a scenario we view as unlikely over the next two years,” it added. (PNA)
