"In our opinion, if the new Greek government fails to agree with official creditors on further financial support, this would further weaken Greece's creditworthiness," said Standard and Poor's in a statement.
The 'B' rating, which already indicates a small assurance of interest and principal payments over the long term, is just two notches above ratings indicating vulnerability of a default.
Greece's new hard-left government on Wednesday halted privatisation and pressed home its demand for debt relief, causing sharp falls on the Athens stock market as investors fretted over the risk of a default.
Prime Minister Alexis Tsipras, comfortably elected on Sunday on a pledge of ending painful austerity in a country worn down by six years of recession, said he wanted a "fair" renegotiation with Brussels of the country's €240 billion (US$269 billion) bailout from the EU and IMF.
Standard and Poor's said putting Greece's rating under review "reflects our view that some of the economic and budgetary policies advocated by the newly-elected Greek government ... are incompatible with the policy framework agreed between the previous government and official creditors."
The ratings agency said Greece has only limited access to commercial bond markets and thus is dependent on its international partners to meet about €17 billion (US$19 billion) in debt repayments this year.
It also pointed to "a recent accelerated pace of deposit withdrawals from Greek banks" and noted that continued support from the European Central Bank was linked to reaching agreement with official creditors.
Standard and Poor's said if Athens does reach a deal with its international creditors "we expect Greece's economy will continue recovering gradually, despite the current policy uncertainty caused by the early elections".
On the other hand, "a protracted inability to strike an agreement could damage Greece's economic recovery prospects and budgetary performance, while exacerbating risks related to the banking system's financial stability," it said. Standard and Poor's said it will make a decision about Greece's credit rating by Marh 13.
- AFP/de
channelnewsasia.com
28/1/15
--
-
Related:
Related:
GR
FR
DE
ES
IT
RU
EU
S&P Could Downgrade Greece’s Credit Rating Amid Policy Uncertainty...
ReplyDeleteThe Standard & Poor's rating agency has put Greece on credit watch, citing the policies of the country's new government as the possible trigger of a future credit rating downgrade.
"The CreditWatch placement reflects our view that some of the economic and budgetary policies advocated by the newly elected Greek government, led by the left-wing Syriza party, are incompatible with the policy framework agreed between the previous government and official creditors," S&P said in a press release Wednesday.
S&P warned that "if the new Greek government fails to agree with official creditors on further financial support, this would further weaken Greece's creditworthiness" and would prompt the agency to lower the country's B/B sovereign debt ratings............http://sputniknews.com/business/20150129/1017479880.html
29/1/15