FE faces rating downgrade

It said the CreditWatch placement reflected a one-in-two chance that the rating house would lower its long-term rating on FEI to 'B-' in the next three months.

“Contrary to our previous expectations, the FEI group has been unable to raise its risk-adjusted capital (RAC) ratio (based on S&P Global Ratings' bank capital methodology) above 15%," S&P said.

“We note that the FEI group has successfully raised its RAC ratio since March 2018 by reducing its property development loan and adding capital.

“However, the positive impact of these measures on the consolidated group's RAC ratio has been offset by strong loan growth and material deductions in capital due to goodwill and other intangible assets.