Moody's slams Belarus ratings

Moody's Investors Service said it downgraded the government of Belarus' long-term issuer and senior unsecured debt ratings to Ca from B3 and maintained the negative outlook.

“The downgrade reflects the weakening of Belarus' credit profile amid Russia's (Ca negative) ongoing military invasion in Ukraine (Caa2 review for downgrade). Belarus is directly exposed to a significant further tightening of sanctions targeting key economic sectors and the financial system that will hamper the country´s already narrow external buffers and jeopardize its capacity to service its debt. The country's external position will be further exposed as will its macroeconomic and financial stability,” Moody’s said in a press release.

A default is increasingly likely, the agency warned.

“Moody's view is that the likely recovery for investors will be in line with the historical average, commensurate with a Ca rating. At the Ca rating level, the recovery expectations are at 35 to 65%.”

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