London. April 9th. Interfax – The international rating agency S&P Global Ratings has downgraded the long-term and short foreign currency rating of the Russian Federation to “SD” (selective default), according to a press release from the agency.
Consequence ratings after the RF Ministry of Finance made payments on the issue of “Russia-2022” and “Russia-2042” in rubles against the background of the US ban on using frozen foreign exchange reserves to service external debts.
“While the default may be cleared within the 30-day food release grace period, we do not provide that investors convert these ruble payments into a standard dollar equivalent, or that the grace period converts these payments during the grace period,” report in a press release from the agency.
Key messages, in particular S&P’s view that “sanctions on Russia will be expanded in the coming weeks, which will limit both the willingness and technical ability of the Russian Federation to fulfill obligations before fulfilling obligations,” are observed in S&P.
S&P has commented on all of Russia’s ratings, including those in local currency rated at ‘CC/C’. The decision to withdraw was made following the introduction of a ban on the application of a ban on rating actions in relation to the Russian Federation and its issuers.
On March 15, 2022, the European Union reportedly imposed a ban on assigning ratings to Russia and administrative companies to EU credit rating agencies, as well as a ban on providing rating services to population groups.