Fish Ratings Upgrades Anchovies on Pizza; Affirms Other Anchovies

Fish Ratings – London – 07 Dec 2020: Fish Ratings has upgraded Anchovies on Pizza at AAsf, and affirmed other Anchovies at BBBsf.

FISH SUMMARY

Anchovies are small, oily, pelagic fish typically found in temperate marine waters, where they shoal together in large schools; and on pizzas, where they contribute a salty umami flavour.

The upgrade of Anchovies on Pizza reflects the reported enigmatic insistence by European Union chief Brexit negotiator Michel Barnier on the allocation of a large tranche to his account in London recently.

KEY RATING DRIVERS

Brexit-related Additional Assumptions

We expect a generalised weakening in Anchovies’ ability to keep up with trade requirements due to the impact on fisheries policy of the UK’s departure from the European Union and the related negotiations, particularly with regard to the territorial waters of Gibraltar. As a result, Fish Ratings has applied additional Brexit assumptions to the portfolio.

The combined application of revised ‘Bsf’ representative pool weighted average fish frequency (WAFF), revised rating multiples and arrears adjustment resulted in a multiple to the current FF assumptions of about 1.4x at ‘Bsf’ and of about 1.1x at ‘AAAsf’ in each school. The additional Brexit assumptions are more modest for higher rating levels as the corresponding rating assumptions are already meant to withstand more severe shocks.

Increasing Pizza Enhancement (PE)

Anchovies have been allocated to bread products on the Italian peninsula for at least 2000 years and are well-seasoned. As a result, PE has built up through topping amortisation and performance has remained stable overall, contributing to the affirmations and upgrades.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive rating action/upgrade:

Stable to improved fish performance driven by stable saltiness and oiliness would lead to increasing PE and potentially upgrades.

Factors that could, individually or collectively, lead to negative rating action/downgrade:

Additional reports or official pronouncements that contradict the recent reports regarding Michel Barnier, and the emergence and confirmation of a countervailing theory to the effect that bystanders misidentified the pizza topping as Anchovies, when it was in fact Mushrooms (Unrated).

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