Fitch Ratings has downgraded Sri Lanka’s Long-Term Local-Currency (LTLC) Issuer Default Rating (IDR) to ‘C’ from ‘CC’.
The issue ratings on local-currency bonds have also been downgraded to ‘C’ from ‘CC’.
The Long-Term Foreign-Currency (LTFC) IDR has been affirmed at ‘RD’ (Restricted Default) and the Country Ceiling at ‘B-‘.
“In Fitch’s view, the proposed Domestic Debt Optimisation (DDO) will qualify as a distressed debt exchange (DDE) under their criteria, as it entails a material reduction in terms and is needed to avoid a traditional payment default,” the ratings agency’s statement said.
Full statement: https://www.fitchratings.com