Rating agencies downgrade major Russian companies

A woman walks past the Moscow International Business Park (Moskva City) in Moscow on March 11, 2022. Russia has taken steps to contain the outflow of foreign currency and capital as much as possible. – France Press agency

Rating agency Fitch lowered the debt rating of 28 Russian commodity companies on Saturday, saying a “default” appeared likely.

Fitch lowered the rating from B to “mostly CC”, the rating of major gas group Gazprom, oil company Lukoil, mining companies Rusal, Polyus, Evraz and 23 other companies involved in raw materials. This means that it is “likely” that these companies will not be able to meet their financial obligations.

For the rating agency, the permission given by the Russian government to pay contracted debts of the “enemy” listed countries in rubles could harm the ability of these companies to pay their creditors on time.

This list includes all countries of the European Union, Australia, the United Kingdom, Canada, Monaco, South Korea, the United States, Switzerland and Japan.

The move is part of a set of measures taken by the Kremlin and the Russian Central Bank to try to mitigate the collapse of the national currency, which lost half its value due to sanctions imposed by Western powers on Russia after the invasion of Ukraine.

Fitch believes that “continued tightening of sanctions, including restrictions on trade and energy imports, increases the likelihood of a political response from Russia and weakens its economy, creating a (hostile) business environment for companies.”

Britain announced on Tuesday a ban on Russian oil, as did the United States on oil and gas.

Moody’s, another rating agency, downgraded Gazprom and Lukoil this week to a level that carries an extremely high risk of default.

In early March, three major rating agencies placed Russia in the category of those who cannot pay its long-term debt, due to the backlog of sanctions on it.

Later, Fitch downgraded this note, stating that Russia was facing an “imminent default” on its debt.

The lower the performance score, the less confidence the lenders have in that country, so the prospects for borrowing at reasonable interest rates are very complex.

know more

+ Omicron: Unexpected symptoms of infection in children worry medical teams
+ Mercadão de SP sellers threaten customers with fruit scams
+ Video: A mother is attacked on social media for wearing tight clothes to take her son to school
+ Horoscope: Check today’s forecast for your horoscope
+ What is known about fluoron?
+ Trick to squeeze lemons is getting craze on social media
“Monster Ichthyosaur” Discovered in Colombia
+ One of the twins became a vegetarian, the other ate meat. Check Result
+ Find out the most stolen cars in SP in 2021
+ Expedition has identified the giant squid responsible for the sinking of the ship in 2011
+ The US agency warns: Do not wash raw chicken meat