03 June 2004 12:45
S&P RATES BASHKORTOSTAN`S SENIOR UNSECURED BOND `BB-`
MOSCOW. June 3 (Interfax) - Standard & Poor's Ratings Services has assigned its 'BB-' senior
unsecured debt rating to the Republic of Bashkortostan's proposed 500 million ruble ($17 million) fixed-coupon bond
issue, the agency said in a press release Thursday.
The bond, which will be issued in June 2004, will have six coupon payments of 4% each, and a 1,092-day maturity.
The bond rating is the same as the issuer credit ratings on Bashkortostan. The ratings are constrained by low revenue
predictability and flexibility, which stem from evolving tax and intergovernmental reforms, dependence on the oil
sector, the need to increase the transparency of financial and socioeconomic policies, still-high contingent
liabilities, and dependence on federal transfers. Low debt, high liquidity, and outstanding budgetary performance
mitigate credit risks at this rating level.
"We assume that Bashkortostan's prudent financial management will help offset the pressure on the budget
resulting from the increase in personnel spending and infrastructure financing needed to restructure the economy,"
said Standard & Poor's credit analyst Felix Ejgel.
[Interfax] |
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