S&P downgrades Ukraine's credit rating to “selective default” amid debt restructuring
Kyiv • UNN
S&P has downgraded Ukraine's credit rating due to the non-payment of a coupon on its Eurobonds. This decision followed a similar move by Fitch, which had earlier downgraded Ukraine's rating to a level close to default.
The US rating agency S&P downgraded Ukraine's credit rating to "selective default" on Friday, citing non-payment of the coupon on Eurobonds, UNN reports, citing the agency's statement.
Details
"We understand Ukraine intends to launch the formal restructuring of some of its Eurobonds through an exchange offer," statement said.
"The rating action reflects a missed coupon payment on Ukraine's 2026 Eurobonds. We do not expect payment within the bond's contractual grace period of 10 business days," S&P explains in a statement its decision to downgrade Ukraine's credit rating from ‘CC/C’ to ‘SD/SD’.
The agency added that this opinion is based on "the adoption in mid-July of a law in Ukraine that allows the government to temporarily suspend payments" on some debt obligations.
Addendum
The S&P decision, as AFP notes, follows the July 24 decision by Fitch, another leading US rating agency, to downgrade Ukraine's credit rating from "CC" to "C," leaving it just one notch above default.
In a statement, Fitch said that the decision was based in part on the view that the agreement reached by Ukraine with some Eurobond holders "marks the beginning of a default-like process.
