Latest news with #Zook
Sky News AU
12-05-2025
- Business
- Sky News AU
Fitch flags concerns about Australia's AAA credit rating just weeks after S&P warns about excessive government spending
A second credit rating agency has raised concerns excessive government spending commitments made in the lead up to the Federal Election could damage Australia's stellar rating in the medium term. Cash splashes to woo voters in the lead up the the federal election were the trigger for a warning from S&P Global in April that Australia's AAA credit rating could be in jeopardy. A further warning has now come from Fitch's director of Asian Sovereign Ratings, Jeremy Zook, who said Australia's AAA rating in the near term was not at risk, but the nation's debt and looming deficits could pose problems in the medium term. 'When we think about the medium term, that's where a lot of our focus will be,' Mr Zook told Sky News' Business Now. 'If we see a sustained upward trend in Australia's government debt, which is not our current baseline, but if we do see a situation where fiscal deficits remain high and growth underperforms and that adds challenges in terms of fiscal consolidation, that is where the risks could arise. 'We think it's more of a medium-term challenge that the government will be looking to address.' Mr Zook also warned a shock to unemployment levels in Australia could pose a challenge for the nation's revenue, as it faces a decade of deficits. 'The labour market remains relatively healthy, but if we do see a shock, that would add perhaps another challenge on the revenue front,' he said. 'Then, secondly, likely in the case of an economic shock, typically governments respond with more fiscal support for the economy. So, in a downside scenario, we could certainly see more challenge for the fiscal outlook.' The federal budget has faced increasing strain, with national debt projected to top $1.2 trillion within two years and deficits expected to persist through the coming decade. Treasury forecasts show deficits continuing into the foreseeable future—including $180 billion in deficits over five years. S&P Global last week warned the big spending promises made by both parties could put Australia's AAA credit rating, which the nation has held since 2003, at risk. 'The 'AAA' rating on Australia may be at risk if election promises result in larger, structural deficits and debt and interest expenses rising more than we expect,' the agency said in a report. 'The budget is already regressing to moderate deficits as public spending hits post-war highs, global trade tensions intensify and growth slows. 'How the elected government funds its campaign pledges and rising spending will be crucial for maintaining the rating.'
Yahoo
07-05-2025
- Business
- Yahoo
Caz Sees a Private Equity Angle for Smaller Investors in Team Sales
Caz Investments, one of the world's larger asset allocators into private equity funds, inked a deal Tuesday with a fintech platform, iCapital Marketplace, to streamline access for financial advisors looking to get their clients into professional sports team ownership. 'Most folks have not gained exposure in any way to sports,' Caz partner Matt Lindholm said on a phone call. 'So for an investment advisor truly looking for non-correlated assets, this is the place you can find it.' More from When the major North American leagues began allowing private equity to buy minority stakes of franchises in 2019, the goal was to access the really big money—pension funds, endowments, insurance companies and other institutional investors who have capital that dwarfs any team owner's. Caz's arrangement with iCapital is significant, because it formalizes the fact that the opening to private equity money hasn't been all about tapping institutional funds—it's become a backdoor for mom and pop investors to get a slice of a pro franchise. ICapital Marketplace is a two decade-old financial technology platform that connects wealth managers with asset managers. The company says its 111,000 financial professional clients manage $228 billion in capital and offer access to funds from behemoths including Ares, Carlyle Group and Blue Owl, all of which happen to have a sports investment line as well. Caz is a $9 billion asset manager founded 24 years ago by Christopher Zook with a focus on thematic investments—that is, investing based on a view of the long-term macro trends. Caz's sports fund is a few years old. Its genesis was inspired by the move toward cord-cutting, the leverage sports teams have to pass along price increases to fans, and the defensive position of many real estate holdings teams possess, Zook told Sportico in 2022. What's unique about Caz among many sports-focused funds is the majority of its sports assets—more than $500 million, according to a March regulatory filing—are invested through other sports investments funds. 'When we look at the world of sports investing, we think it's one of the most attractive places to allocate capital. That's why we've been one of the largest allocators to Arctos since their fund was founded in 2019,' Lindholm said. While Caz's Zook and other firm executives invest their own money in the funds, most of the money is aggregated from smaller investors looking to get into hedge funds, private equity and other alternative investments not open to the average investor. Typically, these are individuals who have enough financial wherewithal to be considered by regulators to be accredited investors for whom riskier and less liquid assets can be suitable investments. It's likely Caz is the largest aggregator feeding into sports funds. It says it is in the top 125 of asset allocators globally to all alternative investment firms and has about 6,500 individuals' money across its funds, which also include funds investing directly in specific privately held companies, as well as more general technology, energy and healthcare funds.
Korea Herald
25-04-2025
- Business
- Korea Herald
Fitch says South Korea resilient amid tariff risks
Global ratings agency projects a 1-point rate cut by central bank to ease deeper-than-expected growth pressures Fitch Ratings is expected to maintain its stable outlook on South Korea despite growing uncertainties, with fiscal discipline emerging as a key concern over the medium term, the agency's sovereign analyst said Friday. 'Korea's sovereign rating remains resilient even amid economic challenges from higher US tariffs and recent domestic political volatility,' said Jeremy Zook, director of Asia-Pacific sovereigns at Fitch Ratings, during a media briefing in Seoul following its annual country conference on Korea's macroeconomic and sovereign outlook. Zook noted that Fitch sees sufficient headroom in Korea's current AA- sovereign rating with a stable outlook, reaffirmed in February, but warned that a significant rise in government debt could erode that buffer. 'The medium-term fiscal outlook and the trajectory of government debt will be important considerations for the sovereign rating going forward,' he said, adding, 'We'll assess the incoming administration's policy once it takes office and unveils its budget." Zook acknowledged that US tariff hikes will likely weigh on Korea's near-term growth. While Fitch does not expect the full 25 percent tariff to take effect, a partial increase appears inevitable, with Korea projected to face an effective rate of around 15 percent. He warned that tariff-related uncertainties could drag the country's growth dangerously to below the current 1 percent forecast. 'We revised our forecast down to 1 percent last week, but following the latest first-quarter GDP figure, there appears to be further downside pressure,' Zook said. Fitch cut its 2025 growth outlook for Korea to 1 percent last week, down from 1.3 percent, ahead of Thursday's first-quarter data showing a 0.2 percent contraction. Zook noted it was an even weaker outturn than Fitch had expected. The analyst foresaw the dampened domestic demand in Korea to recover gradually with the central bank's rate cuts. Fitch anticipated the Bank of Korea to ease the policy rate by 100 basis points over the remainder of the year, bringing the rate down to 1.75 percent. "Subdued growth prospects, combined with easing inflation will prompt the further easing in monetary policy," he said. Despite the slowdown, Zook said a temporary dip in growth is unlikely to affect Korea's sovereign rating, so long as the country's fundamental credit metrics remain stable. He also downplayed concerns over recent political volatility undermining Korea's governance or economy. "We believe Korea has sufficient external financing and fiscal buffers to weather a period of heightened political uncertainty."
Reuters
24-04-2025
- Business
- Reuters
Fitch watching 'quite closely' how South Korea manages geopolitical challenges
Summary SEOUL, April 24 (Reuters) - Global credit ratings agency Fitch said it was "quite closely" watching how South Korea manages geopolitical challenges amid a global trade war between the United States and China. "Korea is a bit caught in the middle between the U.S. and China, and balancing that relationship will likely be more challenging as trade tensions continue to escalate," Jeremy Zook, Asia-Pacific director of Fitch Ratings, said in an interview with Reuters on Thursday. "That is something we will be looking at quite closely, the geopolitical implications in Korea". Earlier this month, Fitch downgraded China's credit rating to "A" from "A+", on expectations of a continued weakening of public finances due to sustained fiscal stimulus amid subdued domestic demand and rising tariffs. The U.S. and China have raised their tariffs against each to more than 100%, which economists say have essentially severed trade between South Korea's two biggest trading partners. South Korea, a major U.S. ally, also faces 25% U.S. tariffs. Zook said the shift in the global trade system was the biggest challenge for the trade-reliant economy, though the agency did not expect any changes to its "AA-" rating for the time being. Later on Thursday, a South Korean delegation, seeking lower tariffs, is scheduled to meet counterparts of the Trump administration for an opening round of trade talks. The trade talks come as South Korea remains embroiled in its worst political crisis in decades, triggered by former President Yoon Suk Yeol's failed martial law attempt. The country will hold a snap presidential election on June 3. "It is uncertain who the new administration will be and that makes the negotiation for Korea a little more challenging in the near term," Zook said. Amid fears over the impact of U.S. President Donald Trump's aggressive tariffs, South Korea's economy unexpectedly contracted in the first quarter, data showed earlier in the day, fanning expectations of more interest rate cuts. Zook, who no longer sees South Korea's public finances as an area of credit profile strength, said there also is space to accommodate more fiscal support to offset growth headwinds in the near term. "There's still fiscal headroom at the current rating level to manage a supplementary budget this year and another supplementary budget potentially after the election," he said. Fitch currently sees South Korea's economic growth for this year at 1.0%, already revised down once this month from 1.3% in March, but there could be "some downside" to it after Thursday's data, Zook said.
Yahoo
24-04-2025
- Business
- Yahoo
Fitch watching 'quite closely' how South Korea manages geopolitical challenges
By Jihoon Lee and Youn Ah Moon SEOUL (Reuters) -Global credit ratings agency Fitch said it was "quite closely" watching how South Korea manages geopolitical challenges amid a global trade war between the United States and China. "Korea is a bit caught in the middle between the U.S. and China, and balancing that relationship will likely be more challenging as trade tensions continue to escalate," Jeremy Zook, Asia-Pacific director of Fitch Ratings, said in an interview with Reuters on Thursday. "That is something we will be looking at quite closely, the geopolitical implications in Korea". Earlier this month, Fitch downgraded China's credit rating to "A" from "A+", on expectations of a continued weakening of public finances due to sustained fiscal stimulus amid subdued domestic demand and rising tariffs. The U.S. and China have raised their tariffs against each to more than 100%, which economists say have essentially severed trade between South Korea's two biggest trading partners. South Korea, a major U.S. ally, also faces 25% U.S. tariffs. Zook said the shift in the global trade system was the biggest challenge for the trade-reliant economy, though the agency did not expect any changes to its "AA-" rating for the time being. Later on Thursday, a South Korean delegation, seeking lower tariffs, is scheduled to meet counterparts of the Trump administration for an opening round of trade talks. The trade talks come as South Korea remains embroiled in its worst political crisis in decades, triggered by former President Yoon Suk Yeol's failed martial law attempt. The country will hold a snap presidential election on June 3. "It is uncertain who the new administration will be and that makes the negotiation for Korea a little more challenging in the near term," Zook said. Amid fears over the impact of U.S. President Donald Trump's aggressive tariffs, South Korea's economy unexpectedly contracted in the first quarter, data showed earlier in the day, fanning expectations of more interest rate cuts. Zook, who no longer sees South Korea's public finances as an area of credit profile strength, said there also is space to accommodate more fiscal support to offset growth headwinds in the near term. "There's still fiscal headroom at the current rating level to manage a supplementary budget this year and another supplementary budget potentially after the election," he said. Fitch currently sees South Korea's economic growth for this year at 1.0%, already revised down once this month from 1.3% in March, but there could be "some downside" to it after Thursday's data, Zook said. Sign in to access your portfolio
