S&P lowers Ukraine's ratings amid failure to make coupon payment on Eurobond

​​​​​​​By Ovunc Kutlu

ISTANBUL (AA) - S&P Global Ratings said Friday it lowered Ukraine's long-term and short-term foreign currency sovereign credit ratings to SD/SD from CC/C.

The SD rating is a non-investment grade, also known as a speculative-grade, given when a country has selectively defaulted on some obligations.

"The government did not make the coupon payment on its 2026 Eurobond Aug. 1, 2024, when the payment was due, and we do not expect the payment within the bond's contractual grace period of 10 business days," it said in a statement.

The rating agency said, however, it affirmed Ukraine's 'CCC+/C' local-currency and 'uaBB' national scale ratings.

It said Ukraine's stable outlook of local-currency rating balances significant fiscal pressures against the government's incentives "to service hryvnia-denominated debt" to avoid distress to domestic banks, the primary holders of the government's local-currency bonds.

Fitch said it could raise Ukraine's local-currency ratings if the country's security environment and medium-term macroeconomic outlook improve.