Fitch: Prolonged NBA lockout could affect ratings

Over the past few months, Fitch Ratings said it has monitored negotiations between the National Basketball Association and the National Basketball Players Association as they attempt to finalize a new collective bargaining agreement.

The current agreement, which was executed in 2005, is set to expire at midnight on June 30.

A meeting between the NBA and the NBPA has been scheduled and if meaningful progress toward a new agreement is not made, Fitch said it expects the NBA will lock out the players.

Similar to the National Football League Players Association's recent action, the basketball players could decertify as a union, which opens other legal avenues, although they did not go this route during a prior labor dispute, Fitch said.

In the event of a work stoppage, Fitch said it will closely monitor any developments to determine impacts to credit quality.

A prolonged work stoppage of a full season or more, although highly unlikely to occur, would impact the NBA's credit ratings, the agency said.

Fitch said it maintained the BBB+ rating on the NBA's $957 million league-wide revolving facility borrowings and the BBB+ rating on its $1.34 billion senior notes.

The outlook on the facility and notes is stable.

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