SYDNEY Feb 21 Fitch Ratings affirmed Austria's
credit ratings at AAA with a stable outlook, saying the
government's favourable budgetary position meant it could handle
the cost of restructuring Hypo Alpe Adria.
The restructuring of Hypo would likely cause gross general
government debt (GGGD) to rise more than previously expected,
the agency said on Friday.
"While there are still a number of options, the government
has yet to disclose its preferred solution, raising concerns
about policy coherence and credibility in the near term," Fitch
said in a statement.
Fitch said it was making the conservative assumption that
the government absorbs HAA's total assets with the effect of
raising debt by 18 billion euros in 2014.
"Despite the one-off stock-flow adjustments to GGGD related
to financial sector support, Fitch believes that Austria's
relatively favourable public debt dynamics, including stronger
growth and low fiscal deficits, should remain intact," said
(Reporting by Wayne Cole; Editing by Kim Coghill)