S&P Downgrades Greek Sovereign Rating To ‘Selective Default’
By Ria Novosti
International ratings agency Standard & Poor’s downgraded on Tuesday Greece’s long-term sovereign credit rating from ‘CC’ to ‘selective default’ after the country launched a bond swap plan last week to ease its debt burden.
“In our opinion, Greece’s retroactive insertion of CACs [collective action clauses] materially changes the original terms of the affected debt and constitutes the launch of what we consider to be a distressed debt restructuring,” S&P said in a statement.
Last week Eurozone officials agreed to a second 130-billion euro ($172 billion) bailout aid package for Greece and called for private investors to waive 53.5 percent of their principal in a bond swap to cut Greece’s massive 360-billion euro debt by 107 billion euros.
Fitch, another international rating agency, downgraded last Tuesday Greece’s long-term foreign and local currency Issuer Default Ratings to C from CCC.
