NEW YORK, July 25. /TASS/. International rating agency Fitch Ratings downgraded Ukraine's Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) from "CC" to "C" level, the agency reported.
"The downgrade of Ukraine's LTFC IDR reflects Fitch's view that the agreement in principle reached on 22 July between the government and some Eurobond holders on restructuring terms, after parliament approved legislation last week allowing the government to suspend commercial external debt payments for three months, marks the start of a default-like process," the statement said.
According to the agency, "In Fitch's view, the reported agreement with external commercial creditors constitutes a distressed debt exchange (DDE) under its sovereign rating criteria, as it involves a material reduction in terms, including reductions in principal amount and interest, and extension of maturities."
On July 22, Ukrainian Prime Minister Denis Shmygal announced that the country's leadership had reached agreements with the Committee of Eurobond Holders of Ukraine on the restructuring of foreign debt. According to him, this will allow Kiev to save $11.4 bln on servicing external debt over the next three years and $22.75 bln until 2033.