Research Update: Turkish Airline Turk Hava Yollari Ratings Placed On CreditWatch Negative After Downgrade Of Sovereign

On May 1, 2018, we lowered our unsolicited long-term local currency and long-term foreign currency ratings on Turkey to 'BB' and to 'BB-', respectively. We believe that Turkish airline Turk Hava Yollari (THY) provides Turkey with an essential service and has strong operational and ownership links with the government, and we therefore link our rating on THY to that on the sovereign. However, THY reported improved operating results in 2017 and we believe there may be potential upside to our view of its stand-alone credit quality. We are therefore placing our 'BB-' long-term issuer credit rating on THY on CreditWatch with negative implications to reflect that we could downgrade the company if we do not revise upward its stand-alone credit

...+ On May 1, 2018, we lowered our unsolicited long-term local currency and long-term foreign currency ratings on Turkey to '##' and to '##-', respectively. + We believe that Turkish airline Turk Hava Yollari (THY) provides Turkey with an essential service and has strong operational and ownership links with the government, and we therefore link our rating on THY to that on the sovereign. + However, THY reported improved operating results in 2017 and we believe there may be potential upside to our view of its stand-alone credit quality. + We are therefore placing our '##-' long-term issuer credit rating on THY on CreditWatch with negative implications to reflect that we could downgrade the company if we do not revise upward its stand-alone credit profile. + We aim to resolve the CreditWatch placement within the next 90 days, once we have gained more information on THY's current operating performance and we have an update on its strategic and financial plans and how it plans to manage the ongoing...

Research Update