Bloomberg News

ECB’s Nowotny Says Regaining AAA Credit Rating Can Take Years

February 24, 2012

(See EXT4 <GO> for more on Europe’s debt crisis.)

Feb. 24 (Bloomberg) -- European Central Bank Governing Council member Ewald Nowotny said history has shown that it can take years for a country to win back an AAA rating.

“If we just look at this in practice, one can see that an AAA rating can be lost quickly, but that it can take a very long time to regain it,” Nowotny, who also heads the Austrian central bank, told reporters in Vienna today.

Austria and France lost their AAA rating at Standard & Poor’s on Jan. 13, as the rating company also downgraded seven other euro nations, citing the European debt crisis. The two countries’ top grade may also be cut at Moody’s Investors Service, according to a Feb. 13 statement.

“Look at what happen when Sweden was going through a financial crisis,” Nowotny said. “It took five to six years till they got back their AAA rating.”

Nowotny, who has repeatedly criticized the “political role” rating companies have been assuming, declined to comment on whether Austria would also lose its AAA rating at Moody’s.

--Editor: Craig Stirling

To contact the reporter on this story: Zoe Schneeweiss in Vienna at zschneeweiss@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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