28 Mar, 2008
Ratings has downgraded Alliance & Leicester, saying the action
reflects the lender's weak access to funding compared with higher
A&L's long term
issuer default rating was cut to A+ from AA- and the short term IDR
to F1 from F1+.
The outlook for
A&L's long term IDR was changed to stable.
Fitch says the
ratings reflect A&L's weaker prospects for reporting growth in
profitability in 2008 and 2009, in view of higher funding costs and
possible further writedowns on its structured credit portfolio.
A Fitch statement
says: "These ratings also take account of the uncertainty
surrounding the UK housing and mortgage lending market.
A&L's capitalisation is acceptable.
"The sound asset
quality of A&L's residential mortgage book and its ability to
pre-fund its business into Q1 2009 are also incorporated into the
ratings and underpin the stable outlook."