Moody's eyes Air Canada for trim

Moody's Investors Service said it placed the ratings of Air Canada and its pass-through trust certificates under review for downgrade, including its Ba1 corporate family rating, Ba1- PD probability of default rating, Baa3 first-lien senior secured rating and Ba2 senior unsecured rating. The company's speculative grade liquidity rating remains unchanged at SGL-2. Moody's rates eight tranches of enhanced equipment trust certificates across three Air Canada EETC transactions, series 2013-1, series 2015-2 and series 2017-1.

The spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented, the agency said.

The passenger airline sector has been one of the sectors most significantly affected by the shock given its exposure to travel restrictions and sensitivity to consumer demand and sentiment, Moody's said.

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