Global rating agencies S&P and Fitch on Friday lowered Ukraine’s foreign currency ratings as they consider the country’s debt restructuring as distressed.
Ukrinform reports this with reference to Reuters.
S&P reduced Ukraine’s foreign currency rating to “SD” from “CC/C”.
“Given the announced terms and conditions of the restructuring, and in line with our criteria, we view the transaction as distressed and tantamount to default,” S&P said.
S&P also said macroeconomic and fiscal stress caused by Russia's invasion of Ukraine may weaken the Ukrainian government's ability to service domestic currency debt and downgraded Ukraine's domestic currency rating to "CCC+/C" from "B-/B."
Fitch, for its part, downgraded Ukraine’s long-term debt from “C” to “RD,” for restricted default.
As Ukrinform reported, earlier the Group of Creditors of Ukraine from the G7 countries and members of the Paris Club of creditors announced their readiness to suspend Ukraine’s debt service obligations until the end of 2023, with the possibility of extending this suspension for a year (until 2024).
On August 10, Ukrenergo and Ukravtodor received the consent of the holders of Eurobonds, which they placed under state guarantees last year, to suspend interest payments and postpone the maturity date of the bonds by two years.