S&P slashes Alfa Bank Ukraine to 'SD'

Standard & Poor’s downgraded its long-term and short-term counterparty credit ratings on Alfa Bank Ukraine from ‘CC/C’ to ‘SD/SD’, and its Ukrainian national scale rating from ‘uaCC’ to ‘SD’, the ratings agency said in a release yesterday. All of the ratings were removed from CreditWatch with negative implications. S&P said it made the move following Alfa’s "distressed exchange" of loan participation notes (so-called due to the extension of maturity of the notes), which it considers tantamount to default. S&P said it would reassess Alfa’s liquidity position and credit standing following completion of the exchange of the notes. Andrii Parkhomenko: Assigning an SD rating is S&P’s usual procedure after a company restructures its bonds; in fact, no new information on the bank or its bonds has arrived. Alfa Bank’s newly issued bonds are not traded yet, but we do not expect S&P’s downgrade to impact the bonds’ future price.