Greek Credit Upgraded by Fitch
Fitch Ratings has rated the new issue Greek sovereign bonds as ‘B-’. These are the 11- and 30-year bonds that Greece issued yesterday as part of the debt swap — or private sector involvement (PSI) — exchange that cancelled about…
Fitch Ratings has rated the new issue Greek sovereign bonds as ‘B-’. These are the 11- and 30-year bonds that Greece issued yesterday as part of the debt swap — or private sector involvement (PSI) — exchange that cancelled about €100 billion of the country’s debt.
According to Fitch, the debt swap “cured the rating default event.” But everything’s not perfect yet:
The agency considers that significant and material default risk remains in light of the still very high level of indebtedness post-PSI and the profound economic challenges faced by Greece, as reflected in the low speculative grade rating of ‘B-‘. However, in Fitch’s view, there is a limited margin of safety for debt service on the new securities over a 12 to 24 month horizon, reflected in the Stable Outlook.
In other words, it’s your choice: green bananas or Greek bonds.
The Fitch Ratings press release is here.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.