No doubt how bad the companies are doing on Japanese soil, in the latest glimpse to add, Fitch Ratings has downgraded Sony and Panasonic debt ratings to junk status. The rating firm downgraded Sony Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDR) to BB- from BBB- while maintaining the Outlooks as Negative.
“Both Sony and Panasonic are struggling to generate operating profits, but each is restructuring and I don’t envision the current situation continuing,” said Masahi Oda, Chief Investment Officer at Sumitomo Mitsui Trust Bank. “A collapse of their core business would be a problem, but we are not at the point yet, and to me Fitch looks too negative.”
