S&P Global Ratings on Oct. 17 assigned Spanish stock exchange operator Bolsas y Mercados Españoles Sociedad Holding de Mercados y Sistemas Financieros, or BME, an A- long-term issuer credit rating, with a stable outlook.
The stable outlook indicates the rating agency's assessment that BME will maintain its dominant domestic market position and gradually diversify its revenue sources to mitigate deteriorating revenue prospects from cash equity trading. The agency expects the firm to be cautious about the size and valuation of investments for any potential acquisition toward its goal of diversifying revenue into post-trade and securities services.
The rating reflects the agency's assessment of the company's financial risk profile as minimal is based on its low debt leverage, strong operating efficiency and vertical integration. Meanwhile, the firm's geographical concentration in Spain and a relatively narrow revenue base compared to some peers partially offset the aforementioned credit strengths.
S&P Global Ratings views BME as a nonoperating holding company and rates it one notch below the 'a' group credit profile to take into account structural subordination.
This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings