Fitch Ratings

London-based Fitch Ratings has maintained its stable outlook for the Philippines, saying the country is “reasonably healthy” despite the disorder in the global economy.

Eight days after Moodys upgraded the country’s credit rating to two notches below investment grade, the Philippines enjoyed another boost to its international image as Fitch Ratings upgraded the country’s credit rating to just a notch below investment grade. With the decision, the Philippines’ credit rating on its long-term foreign obligations now stands at BB+, an improvement from the previous BB. The Fitch upgrade is the 4th positive ratings action in the 11 months of the Aquino administration and is unprecedented in Philippine history because it’s the first time since June 2003.

According to Fitch’s projections, the Philippine government’s budget deficit for 2011 would stand at 3 percent of the country’s gross domestic product, an improvement from the 3.7 percent registered last year. Fitch said the country was on track in meeting its medium-term fiscal development goals, citing recent improvements in revenue collection by the government. Revenue collection grew 18 percent in the first four months from the same period a year ago, it noted. The credit-rating firm said that should revenue collection growth continue the county was well poised to reduce its overall debts over the medium term. The country’s debts stood at 57 percent of its GDP in end-2009, but Fitch said there was a chance the figure could decline to 50 percent by end-2013. Also, Fitch's rating for the Philippines is one notch higher than ratings by Standard and Poor's and Moody's Investors Service.

Regarding the ratings, Fitch also upgraded the local banks credit ratings. On a related news, Fitch Ratings raised the credit ratings of Bank of the Philippine Islands (BPI) and Development Bank of the Philippines, to “BB+”. The foreign currency and local currency ratings of Banco de Oro Unibank (BDO), Metropolitan Bank & Trust...