REUTERS
Fitch Ratings has affirmed Ukraine's Long-Term Local Currency (LTLC) IDR at 'CCC,' Fitch Ratings said in its press release.
The issue ratings on Ukraine's Long-Term senior unsecured Local Currency bonds have also been affirmed at 'CCC'. The Short-Term Foreign Currency (STFC) IDR has been affirmed at 'C' and a new Short-Term Local Currency (STLC) IDR of 'C' has been assigned, according to the press release.
Under the European Union credit rating agency’s (CRA) regulation, the publication of sovereign reviews is subject to restrictions and must take place according to a published schedule, except where it is necessary for CRAs to deviate from this to comply with their legal obligations.
Read alsoFitch affirms 5 Ukrainian foreign-owned banksFitch interprets this provision as allowing the country to publish a rating review in situations where there is a change in the criteria one believes makes it inappropriate to wait until the next scheduled review date to update the rating or Outlook/Watch status. The next scheduled review date for Fitch's sovereign rating on Ukraine is November 11, 2016, but Fitch believes that a portfolio review is now warranted based on recent changes to the country’s criteria.
In line with the updated guidance contained in Fitch's revised Sovereign Rating Criteria, dated July 18, 2016, Ukraine's credit profile does not support a notching up of the LTLC IDR above the LTFC IDR. This reflects Fitch's view that neither of the two key factors cited in the criteria that support upward notching of the LTLC IDR are present for Ukraine. Those two key factors are: (i) strong public finance fundamentals relative to external finance fundamentals; and (ii) previous preferential treatment of LC creditors relative to FC creditors, the report said.