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Moody's lowers Greek credit rating

Reported by AAP
Saturday, June 2, 2012
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Moody's rating agency says it is lowering Greece's highest possible credit rating because of an increased risk that the country will exit the euro zone.

Moody's said on Friday it "has lowered its assessment of the highest rating that can be assigned to a domestic debt issuer in Greece to Caa2.

The highest rating "on any Greek security is currently B1, which is rating assigned to certain covered bonds", it said. "Any rating actions taken as a result of the new ceiling will be released during the coming week."

According to Moody's, although the risk of Greece's euro exit "is substantial", it is still not what the ratings agency considers the most likely scenario.

"Moody's also notes that there is a potential for exceptions whereby a security could be rated higher than Caa2 if the "Greek" issuer is essentially a non-domestic company, has substantial assets outside the country or receives substantial support from an entity outside the country," the New York-based ratings agency said.

Elections on June 17 will determine whether Greece will meet the terms of a deal under which the European Union and International Monetary Fund agreed to lend it hundreds of billions of euros in return for economic reforms.

Following the vote "it is possible that the risk of euro exit will increase further. If that were to occur, the maximum rating Moody's would assign to Greek securities would fall further," Moody's said.

26/10/2014 07:40Sydney, Australia. 26 October,2014
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