Fitch upgrades Napocor debt by a notch to “BB+"

Fitch Ratings upgraded on Monday the notes issued by the National Power Corp. (Napocor) in 2005 and 2006, following the Singapore-based credit rating agency’s recent upgrade of the country's Long-Term Foreign Currency Issuer Default Rating (LTFC IDR) last week. In a statement, the credit rating agency said Napocor's $300-million floating rate notes raised in 2005 and payable by August 2011 have been upgraded to "BB+" from "BB" with a stable outlook. The rating of Napocor’s $500-million fixed-rate notes issued in 2006 and due November 2016 has also been raised to "BB+" from "BB," also with a stable outlook. The Napocor ratings are credit-linked to the country, Fitch said, as both the notes are irrecoverably and unconditionally guaranteed by the Republic of the Philippines. The rating agency said its Monday upgrade follows the recent grade raise of the Philippines' LTFC IDR, as the country received a "BB+" rating and a "BBB-" rating on its long-term foreign currency debt and long-term peso debts, respectively. It also maintained at "B" the Philippines’ short-term foreign currency issuer default rating. "The upgrade reflects progress on fiscal consolidation against a track record of macro stability, broadly favorable economic prospects and strengthening external finances," said Andrew Colquhoun, head of Fitch's Asia-Pacific Sovereigns team. —JMT/VS, GMA News