S&P downgrades Toshiba

Standard & Poor’s said it lowered the long-term corporate credit rating on Toshiba Corp. to B+ from BB+, along with its long-term senior unsecured debt rating to BB from BBB-.

The debt rating is two notches higher than the corporate credit rating, reflecting that the probability of default in Toshiba’s bonds is lower than that in its bank borrowings, S&P said.

The company’s long-term ratings remain on CreditWatch with negative implications, where they were placed in December 2015, the agency said.

The downgrades and continued watch follow Toshiba’s further material downward revision of its estimated operating performance in fiscal 2015, which is likely to further erode its equity for shareholders, S&P said.

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