S&P Cuts Ziraat's Foreign Currency Rtgs To B-/C;Outlk Stable.NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 7/1/97 -- Standard & Poor's today has lowered its long-term foreign currency counterparty rating of T.C. Ziraat Bankasi a.s. (Ziraat) to single-`B'-minus from single-`B' and its short-term foreign currency counterparty rating to single-`C' from single-`B', following Ziraat's failure to settle its position in the domestic interbank market Interbank market Financial institutions exchange of currencies between and among themselves. on June 16, 1997. The outlook on the rating is stable. At the same time, Standard & Poor's lowered its ratings on Ziraat's foreign currency certificates of deposit to single-`B'-minus/single-`C' from single-`B'/single-`B'. Standard & Poor's has not assigned Ziraat a local currency counterparty rating. Standard & Poor's downgrade of its ratings on Ziraat to one notch below those of its shareholder, the Republic of Turkey (foreign currency rating single-`B'; outlook stable; reflects the agency's view that either because of Ziraat's own cash management difficulties or the lack of timely government support, Ziraat could experience similar shortfalls in the foreign exchange market. Any needed government support could be delayed by shifting or uncoordinated un·co·or·di·nat·ed adj. 1. Lacking physical or mental coordination. 2. Lacking planning, method, or organization. un monetary policy measures among Turkey's decision makers operating in an uncertain environment. Standard & Poor's still believes, however, that the republic will ultimately support Ziraat to the extent it is able. Ziraat is the paying agent Paying Agent An agent who accepts payments from the issuer of a security and then distributes the payments to the holders of the security. Also known as a "disbursing agent. for many of the commercial transactions of the Treasury of the Republic. Each Friday, the Treasury sweeps credit balances or covers debit balances from its Ziraat account. On Monday, June 16, Ziraat effected payment for part of the country's civil service, by order of the treasury. The payment of the civil servants overdrew the treasury's account with Ziraat and forced Ziraat to bid for funds in the interbank market. When it was unable to fund itself in the interbank market due to tight liquidity conditions, it approached the central bank's discount window. The central bank did not advance Ziraat the necessary funds and Ziraat along with four other banks failed to settle their positions in the interbank market. Ziraat's position fell Turkish Lira (TL) 16 trillion (US$110 million) short that day. On June 17, Ziraat sold under an agreement to repurchase eligible collateral with the central bank to clear its position in the interbank market and on June 18, Ziraat repaid the central bank. Ziraat is the largest bank in Turkey with total assets at Dec 31, 1996 of TL 1,628 trillion (US$15.1 billion). In addition to its role as the government exchequer Exchequer English government department responsible for receiving and dispersing public revenue. It was established by Henry I in the 12th century, and its name refers to the checkered cloth on which the reckoning of revenues took place. , Ziraat is a key instrument to effect government agricultural subsidies agricultural subsidies, financial assistance to farmers through government-sponsored price-support programs. Beginning in the 1930s most industrialized countries developed agricultural price-support policies to reduce the volatility of prices for farm products and to . -- CreditWire CONTACT: Marie Cavanaugh, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of (1) 212-208-1579 Cem Karacadag, New York (1) 212-208-8984 John Chambers John Chambers could be any of the following people:
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