NY –- Standard&Poor's CreditWire 12/18/98 –- Standard&Poor's today placed its ratings for Bank of Nova Scotia (Scotiabank) and related entities on CreditWatch with negative implications (see list). The action reflects Scotiabank's weak capitalization and its emerging markets exposure, which could result in a modest ratings downgrade, particularly if Latin American countries' economies succumb under the pressures of deteriorating investor confidence. The bank's management has not been particularly adept at avoiding the temptation and, ultimately, the pitfalls of other higher-risk lending activities such as commercial real estate. Given this relatively strong appetite for credit risk, both the quality and quantity of Scotiabank's capitalization can at best be described as only middling, especially compared with that of U.S.
