S&P puts Espirito, Energias on watch, cuts Parpublica

Standard & Poor's said that it placed the A-/A-2 long- and short-term ratings of Banco Espirito Santo, SA, its subsidiary Banco Espirito Santo de Investimento, SA and Energias de Portugal, SA on CreditWatch with negative implications.

S&P also said it lowered Parpublica, Participacoes Publicas, SA's long-term issuer credit and senior ratings to BBB from BBB+.

The CreditWatch placement of Banco Espirito follows that on Nov. 30 of the Republic of Portugal. Furthermore, the agency said Portugal's macroeconomic challenges and difficult external financing conditions will put pressure on Portuguese banks' operating environment, potentially weakening their creditworthiness.

The placement of Energias de Portugal reflects the hardening fiscal austerity and depressed economic growth prospects, which could result in a weakening of the business risk profiles, S&P said.

The agency said the rating downgrade reflects Parpublica's rapidly increasing leverage.

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