Fitch Ratings has upgraded the City of Kyiv's Long-Term Foreign Currency Issuer Default Rating (IDR) to 'CCC' from 'D', MinFin reports
The city of Kyiv's long-term credit rating has been upgraded due to the completion of Kyiv's $550m Eurobond restructuring as well as satisfactory fiscal performance.
Fitch has also upgraded the city's Local-Currency IDR to 'CCC' from 'D' following restructuring of its domestic bonds. The restructuring does not involve a write-down of principal or a decrease in coupons - Kyiv has extended the maturities of its domestic bonds by 12 months from the original maturities of 1 October and 7 December 2015.
Fitch expects Kyiv's budgetary performance to remain volatile due to overall weakness of sovereign public finances, lower predictability of fiscal policy and short planning horizon, exacerbated by negative macro-economic trend.
Meanwhile, Fitch expects contraction in Ukraine's economy by 11.6% in 2015, which negatively affects the city's fiscal capacity. Any adverse change affecting the city's ability and capacity to refinance or repay its domestic bonds would lead to a downgrade.
