international rating agency Fitch announced on Wednesday lowered Greece’s long-term foreign and local currency issuer default rating from “CCC” to “C”, and confirm that the Greek short-term foreign currency rating to “C” level. Fitch said the C rating in Greece show that Greece recently is very likely to default.
in Greece that will force reluctant to participate in the debt swap of the bondholders to accept the outside world has been widely expected after write-downs, its rating will be lowered. The
, down the reason
Fitch said the proposal to reduce Greece’s public debt through debt replacement will constitute a breach of contract; the implementation of collective action clauses will be on private enforcement of creditors; debt replacement is completed, the Greek issuer default rating will be lowered to the local default; completion of the debt agreements in Greece after the Greek out of the default rating.
Fitch lowered the action followed by the declaration of the euro group. Euro Group issued a statement yesterday said the second round of the Greek aid agreements will include private sector participation, and related replacement of the Greek authorities on Greek government bonds listed contents of this announcement “. Today’s rating action is in line with Fitch 2011 66 days of the declaration. Fitch lists will be sovereign debt swap rating.
Euro Group Bulletin notice that the Greek authorities and the private sector in the PSI swap has reached a basic consensus, including write-downs in the name of 53.5% of the nominal value of government bonds in Greece. The subsequent declaration of the Greek authorities to expand the conditions of the debt swap, and confirmed that the Greek government intentionally by the Greek law, collective action clauses into these bonds are interchangeable.
in Fitch’s view, according to its rating criteria, if completed, the replacement behavior would constitute a “bad debt exchange, so yesterday’s announcement, Fitch began to re-evaluate the rating of the Greek bond issuers .
bond issuer default rating to “C”, means that the recent highly probable breach of contract. The bond issuer’s bond rating for interchangeable corresponding underground raised “C” rating.
outlook rating arrangements
Fitch of
believes that, in order to reduce Greece’s public debt burden by the private sector and voluntary debt swap proposal, if able to complete would constitute a the rating breach “; and after the implementation of the debt swap, the Greek rating will be lowered to the” partial breach “. Shortly after the implementation of the new debt swap, the sovereignty of Greece will be removed “restricted default” rating, and re-rating in accordance with the assessment of rating agencies and credit conditions in the post-default “.
subject to the debt swap impact on Greek government bonds may also be lowered to “D” rating, that is default rating.
Note: “C ‘Fitch rating system junk, which is the most junk.
Tags: Fitch Greece rating to most junk, Greece
