NEW YORK, Tue Nov 6, 2012 – Superstorm Sandy will slash earnings at New Jersey casinos and benefit home repair and discount retailers but have limited impact on other sectors and is unlikely to trigger credit downgrades, credit agency Moody’s Investors Service said.
While potential credit downgrades exist, no rating actions were taken after Hurricane Irene flooded parts of the U.S. Northeast last year and no ratings have been put on review for downgrade or negative ratings after Sandy, Moody’s told investors on Tuesday.
Such actions were taken after Katrina in 2005, one of the deadliest and most destructive hurricanes to ever slam the United States. To the best of Moody’s knowledge, large natural disasters do not result in payment defaults, with the exception of one non-rated transportation issue after Katrina.
“Even for the hardest hit areas (by Sandy), we don’t expect to observe any payment default by our issues barring any significant change in federal policy regarding FEMA and emergency aid,” said Gail Sussman, a managing director at Moody’s.
FEMA is the Federal Emergency Management Agency. Sandy has killed at least 113 people in the United States and Canada and knocked out power to millions of people. It has swamped seaside towns and inundated New York City’s streets and subway tunnels.