Fitch rates Lipetsk bond AA-(rus)

Fitch Ratings said it assigned the Russian Region of Lipetsk's issue of RUB1.5 billion domestic bond with a maturity of five years a national long-term AA-(rus) rating.

The region is rated international issuer default BB- and national long-term AA-(rus).

Both ratings have positive outlooks.

Fitch said the ratings reflect the region's strong budgetary performance, its ability to expand its investment through borrowing given its small current debt burden and the prospects for diversifying the local economy.

However, they also take into account its heavy dependence on a single taxpayer and the need to cope with growing social expenditure pressures.

The positive outlooks reflect Fitch's expectations that economic growth in the region will provide revenue growth and compensate for the rising expenditure burden.

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