S&P raises Eletrobras

Standard & Poor's said it raised its foreign and local currency corporate credit ratings on Eletrobras - Centrais Eletricas Brasileiras SA to BB and BB+, respectively.

The outlook is stable.

The agency noted these actions follow its raising of the foreign and local currency sovereign credit ratings on Brazil.

Eletrobras ratings are linked to the credit quality of the Federative Republic of Brazil, S&P said, adding that the company is majority owned by the government (58.4%) and it believes that the government has strong incentives to support Eletrobras in case of need given its strategic role in financing Brazil's electric power industry and managing federal generation, transmission and distribution assets.

The company is also exposed to the evolving regulatory environment in Brazil, which can affect its loan portfolio's credit quality, the performance of its subsidiaries, some of which might require financial support from Eletrobras and the strong influence of the government on its strategic planning, S&P added.

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