FX.co ★ S&P lowers Ukraine’s foreign currency rating from 'CC' to 'SD'

The international agency Standard & Poor’s has downgraded Ukraine’s credit rating from ‘CC’ to selective default level ‘SD’. Ukraine violated a repayment term: it failed to pay the amount of $500 million on September, 23. This was one of the main reasons for this downgrade. Earlier, the agency also considered that the country's default was inevitable.
The day before the payoffs, the government of Ukraine stopped all payments on foreign debt under the restructuring agreement with creditors. Up to December 1, 2015, the country's leadership will have to exchange old bonds for new ones considering the writing off 20% of debt and the extension of the repayment time limit of the remaining amount until 2019.
Importantly, some creditors are not satisfied with the new arrangement, as the delay in payments equals to about eight years.
At the same time, the agreement with Russia on the debt of $3 billion has still not reached. The Russian Federation is against the inclusion of the debt into the restructuring program. Russia insists on a special deal on the issue, as it is considered to be Ukraine's sovereign debt. However, the Ukrainian government says that shares were purchased on the open market. Therefore, the obligation is to be fulfilled according to general principles.