Coovadia: Downgrade will affect entire economy

The Banking Association of South Africa's (Bassa) Cas Coovadia says he has been working with Treasury for 16 months to avoid the very same downgrade the country has woken up to.

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JOHANNESBURG - The Banking Association of South Africa's (Bassa) Cas Coovadia says he has been working with Treasury for 16 months to avoid the very same downgrade the country has woken up to on Tuesday morning.

He says the downgrade by S&P Global will have a ripple effect on the banks, the poor and ultimately on the entire economy.

"I think it will affect the banking sector as the banks will automatically be downgraded on the back of the sovereign downgrade. It will have a negative impact on confidence, negative impact on reputation."

On Monday evening, Standard & Poor’s Global Ratings said it was downgrading the country’s sovereign credit rating status to junk, then Moody’s said it would review the country’s rating.