Jump Financial LLC 'BB-' Rating Placed On CreditWatch Negative On Uncertain Risk-Adjusted Capital Trajectory

Jump Financial LLC's (Jump) expansion into slightly longer-duration strategies, which includes holding more positions overnight, has increased its exposure to trading risk, in our view. All else equal, our preliminary results indicate that Jump's risk-adjusted capital ratio could decline below our 10% threshold that we currently factor into our rating assessment, and potentially lead to a downgrade by one notch, in the absence of countervailing measures. As a result, we placed our 'BB-' issuer credit and senior secured debt ratings on Jump on CreditWatch with negative implications. The CreditWatch negative placement reflects the possibility that we could lower our ratings on Jump in the coming months if the company is unable to demonstrate a path to a RAC ratio closer

...July 14, 2023 - Jump Financial LLC's (Jump) expansion into slightly longer-duration strategies, which includes holding more positions overnight, has increased its exposure to trading risk, in our view. - All else equal, our preliminary results indicate that Jump's risk-adjusted capital ratio could decline below our 10% threshold that we currently factor into our rating assessment, and potentially lead to a downgrade by one notch, in the absence of countervailing measures. - As a result, we placed our '##-' issuer credit and senior secured debt ratings on Jump on CreditWatch with negative implications. - The CreditWatch negative placement reflects the possibility that we could lower our ratings on Jump in the coming months if the company is unable to demonstrate a path to a RAC ratio closer to 10%. TORONTO (S&P Global Ratings) July 14, 2023--S&P Global Ratings said today it placed its '##-' issuer credit and senior secured debt ratings on Jump Financial LLC on CreditWatch with negative implications....

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