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Russia rating downgrade no problem for Russian companies' debt repayment — official

January 28, 2015, 17:44 UTC+3 MOSCOW

Even if a problem of early bond repayment exists it’s less than initially expected, Deputy Minister of Economic Development says

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© AP Photo/Pavel Golovkin

MOSCOW, January 28. /TASS/. Almost no Russian companies will face problems with early bond repayment due to recent Russian ratings downgrade, Deputy Minister of Economic Development Nikolay Podguzov said on Wednesday.

"Our thorough study showed that there are no such covenants (early repayment peg to Russia’s or company’s rating — TASS) in the Russian companies’ public debt contracts, including Eurobonds. I mean we didn’t find such conditions, but probably we missed something out," Podguzov said.

"We can say that even if a problem like that exists it’s not that huge, and it’s less than we initially expected," he added.

On January 26, the international rating agency S&P cut Russia’s credit rating to junk level, putting it below investment grade for the first time in a decade. It added a negative outlook on the rating, saying, "The downgrade reflects our view that Russia's monetary policy flexibility has become more limited and its economic growth prospects have weakened." S&P last downgraded Russia in April.

Earlier this month, Fitch and Moody’s downgraded Russia to their lowest investment grades.

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