S&P ups Argentine governments

Standard & Poor's said it raised its foreign and local currency global scale issuer credit ratings on the City of Buenos Aires, and the provinces of Cordoba, Buenos Aires and Mendoza to B- from CCC-.

The outlook is stable.

The agency also raised its global scale issue-level ratings on the provinces of Neuquen and Salta to CCC+ from CCC- and placed them on CreditWatch positive.

S&P said the global scale foreign and local currency ratings on these four local and regional governments (LRGs) primarily reflect its B- global scale long-term local currency issuer credit rating and T&C assessment on Argentina.

According to the agency’s criteria, the local currency ratings on Argentinean LRGs could be above the sovereign ratings if there's a measurable likelihood that any of credit characteristics on these entities will remain stronger than those of the sovereign in a scenario of economic or political stress.

However, S&P doesn't consider these LRGs meet the criteria under which it would rate them higher than the sovereign. This is mostly due to insufficient liquidity to cover all debt obligations. The liquidity assessments on these LRGs incorporate their cross-default clauses and debt market volatility. S&P consequently caps their local and foreign currency ratings at the Argentina's local currency rating level.

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