NYSE Euronext rating cut by S&P

17 May 2010

The rating of NYSE Euronext has been downgraded by Standard & Poor’s to AA- from AA.

According to the agency, the move to reduce the rating follows news that the firm is ending its relationship with LCH.Clearnet Ltd and LCH.Clearnet SA.

NYSE Euronext is now expected to develop two new clearing houses in Paris and London by the end of 2012.

The decision increases the organisation’s exposure to risk during a period where it is already attempting to reduce outstanding debt levels, the agency explained.

In a statement, S&P said: “The building of two clearing houses in Europe changes the company's risk profile, introducing a degree of credit and financial risk that is currently not reflected in the ratings.”

The organisation added that the debt reduction program instigated by NYSE Euronext has made slow progress despite an improvement in the firm's financial profile due to enhanced earnings.

Figures released by NYSE Euronext for the first quarter of the month showed that the firm recorded a net income of $130 million.

The amount was higher than the $104 million posted during the same quarter of 2009.

By Jim Ottewill

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