Malta Credit Ratings

Dr. Jean-Philippe Chetcuti | 05 Sep 2018

Malta Credit Ratings

Malta Credit Ratings


Over the past decade Malta’s booming economy has attracted consistent positive reviews by international credit rating agencies. Despite its relatively small economy, Malta’s strategic location at the centre of one of the world’s most economically vibrant regions, has exposed the island to the benefits garnered through international trade and investment. Malta’s economy in fact continues to be one of the best performing in Europe, experiencing an impressive 6.6% real growth in GDP in 2017. Furthermore, the country is expected to maintain this vigorous growth pattern over the coming years. 

The the top 4 international credit rating agencies all rank Malta well, noting a stable or positive outlook for the economy, with the current sovereign Malta credit ratings being; 

  Date Rating Outlook
Moody's 21.08.2018 A3 Positive
Fitch 03.08.2018 A+ Stable
DBRS 17.08.2018 A Stable
Standard and Poor's (S&P) 24.03.2018 A- Positive


Moody's most recent Malta credit rating was reported at A3 with positive outlook. Fitch's credit rating for Malta was last set at A+ with stable outlook. DBRS's Malta credit rating remains A (high) with stable outlook. Standard and Poor's (S&P) credit rating for Malta stands at A- with positive outlook. 


Moody’s Malta Credit Rating

Moody’s ratings agency reports an A3 positive Malta credit rating. The agency has praised Malta’s high-level of global competitiveness, which along with uplifted wealth levels, allows the country to quickly reconsolidate itself against external shocks. This can be evidenced in Malta’s strong economic growth and rising per-capita income. The agency also outlines sustained improvement in Malta’s public sector debt reduction, further anticipated fiscal reduction, and high institutional strength. Based on financial soundness and the size of the banking sector, Moody’s assumes that potential instability in the banking industry has low risk to the country.  

 

Fitch Malta Credit Rating 

International agency Fitch Ratings declares an A+ score with a stable outlook for Malta’s long-term foreign-currency issuer default rating, confirming confidence in Malta and evident progress in the economy. The agency holds that Malta’s credit rating is reflective of the country’s high income per head compared with the ‘A’ median, its buoyant economic growth, and a larger net external creditor position. Fitch estimates Malta’s medium-term potential growth at 3%- a more cautious estimate than the European Commission’s, in light of anticipated pressures on the infrastructure and growing labour shortages. Inflation is nevertheless expected to remain contained at 1.6% in 2019 and 1.8% in 2019. Following a 5.3% year on year rise in property prices in 2017, the rising house supply should help stabilise property prices, which only face moderate risks arising from the private sector. Fitch also points out that World Bank governance indicators for Malta exceeded those of countries with an ‘A’ rating, and were comparable with ‘AA’ countries. 


DBRS Malta Credit Rating

DBRS Ratings Limited (DBRS) reports Malta’s Long-Term Foreign and Local Currency – Issuer Ratings at A (high) and its Short-Term Foreign and Local Currency – Issuer Ratings at R-1 (middle). The trend on both ratings is stable. The high rating is reflective of Malta’s membership in the Eurozone, its consolidated external position, minimal dependency on external financing, and favourable public debt structure, amongst other things. The agency applauded the country’s continuing outperforming growth rates compared to the EU average, as well as the maintenance of budgetary surpluses and gradually declining public debt ratio. The agency acknowledges notable contributors to the fiscal surplus, one of which being the valuable proceeds from the Malta Individual Investor Programme. DBRS cautions however against potential external pressures from the global trade war incited by the US, and repercussions of Brexit on the local tourism industry. 


Standard and Poor’s (S&P) Malta Credit Rating 

Standard and Poor’s Global Ratings set an A and A-2 score for Malta’s long-term and short-term ratings respectively, with a positive outlook for the Maltese economy. The outlook is a result of maintained strong economic growth, recurring fiscal surpluses and advancements in the budget and fiscal management. Among the worthwhile economic developments in Malta, S&P highlights the contribution of net exports, investment in energy and logistics, and improved employment opportunities coupled with augmented participation rates particularly amongst women. The agency is also confident that Malta will maintain its progressive financial situation, supported by macroeconomic policymaking which is expected to remain focused on furthering fiscal consolidation. Persisting economic growth and fiscal performance could also very likely see Malta’s credit rating increase. 
 


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