“Default Imminent”: Ukraine’s Rating Drops from CC to C

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August 31st, 2015
Rusvesna  – translated for Fort Russ by Soviet Bear

Editor’s note: How much did the IMF haircut for Ukraine help its credit ratings?  Not a whole lot. In fact, with a ‘CC’, creditor’s take it as a sign of inevitable and imminent default.

Of course, Ukraine has already defaulted but was allowed to play word games.  The big fiasco now is if the EU Atlanticists will be able to pressure Russia to let go of some of what its owed too.  That’s not likely, and Russia has said ‘no’ at least twice already.  Still, the EU coddles Ukraine and tows the US line of deference to Ukraine so long as it pursues the war in the east. 

Rusvesna reports:

The Fitch International rating agency has downgraded Ukraine’s issuer default rating from CC to C on the background to the agreement of the Ukrainian authorities with international creditors to write off 20% of the national debt. This is stated in the message of the agency.

According to the classification of Fitch the rating assigned to C says about the inevitability of a default in the fulfillment of debt obligations. Fitch believes that the restructuring of Ukraine’s debt leads to financial losses to creditors and leads to an inevitable default.

The debt write-off would cause the Issuer default rating of Ukraine in foreign currency will be lowered to the level of RD, and this suggests that the Issuer has not made timely payments with the given period of grace for some, but not all of the basic obligations and continues to conduct payments on other types of obligations. The rating of Ukraine will be revised after a successful debt restructuring.

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