S&P downgraded Ukraine’s credit rating

At the same time, the agency confirmed the sovereign ratings on the hryvnia (LC) CCC+/C and the national scale rating uaBB.

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International rating agency S&P Global downgraded Ukraine’s long-term and short-term foreign currency credit ratings to the level of “selective default” – from CC/C to SD/SD – due to the missed payment on Eurobonds on August 1 amid restructuring of debt. This was reported on the S&P website on Saturday, August 3.

“We understand that the government has decided to suspend bond payments pending the restructuring. To this end, the government has not made the coupon payment on its 2026 Eurobonds on August 1, 2024, when the payment is due, and we do not expect payments to be made during the contractual grace period of workers’ bond days,” the statement said.

As a result, the sovereign’s 2026 Eurobond issue was also downgraded to D (default) from CC, while the CC rating on the remaining senior unsecured foreign currency bond issue was affirmed.

At the same time, the agency confirmed the sovereign ratings on the hryvnia (LC) CCC+/C and the national scale rating uaBB.

“We understand that Ukraine’s public debt, denominated in hryvnia, is not subject to restructuring. The LC rating outlook is stable,” the statement said.

Earlier, international rating agency Fitch Ratings downgraded Ukraine’s credit rating from CC (very high credit risk) to C (imminent default). The agreement between the Ukrainian government and some Eurobond holders in terms of restructuring marks the beginning of a process similar to a default, analysts say.

We remind you that on July 22 it became known that Ukraine agreed to payments on its external debt. This important step in the debt restructuring process will save $11.4 billion in debt service costs over the next three years.

On the same day it was reported that the value of Ukrainian Eurobonds increased.

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