S&P drops Belize

Standard & Poor's said it revised its long-term foreign currency sovereign credit rating on Belize to SD from CC/C.

At the same time, S&P said it revised to D its long-term foreign currency ratings on the rated bonds that are included in a proposed exchange.

In addition, S&P said it affirmed its CCC+/C local currency sovereign credit rating on Belize.

These rating actions follow Belize's announcement that it would offer to exchange most categories of its outstanding external commercial debt for new dollar bonds, the agency said, adding that the new bonds will bear interest in the first three years after issuance at a fixed per-annum rate of 4.25%.

In years four to five, the rate will increase to 6.00% and thereafter, through maturity, the interest rate will level off at 8.50% per annum, S&P said.

When the debt restructuring is complete, S&P said it will revise its SD and D ratings to a rating that incorporates a forward-looking assessment of Belize's debt-servicing capacity, most likely in the B category.

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