S&P rates Belize bond B+

Standard & Poor's said it assigned its B+ senior unsecured long-term foreign currency debt rating to Belize's proposed 30-year U.S. dollar bond putable in 2011.

"This bond issue is part of the government's ongoing strategy to refinance its direct external obligations as well as the government-guaranteed external debt of the Development Finance Corporation (DFC), the country's government-owned development bank," said S&P credit analyst Olga Kalinina. "In fact, this is the government's third issue since August 2002, the proceeds of which will be mainly used to refinance existing public-sector debt."

According to Kalinina, about 80% of the bond's proceeds are expected to be used to refinance the government's direct debt and repay the DFC's external debt, which it incurred as part of its government-guaranteed mortgage securitization operations. As such, the debt issue is expected to improve both the interest and maturity profiles of the general government debt and reduce the DFC's external debt as part of the DFC's restructuring program.

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