Page 113 - RusRPTJun21

Russia - Rating agency
as of July 1, 2020
last change
Moodys (USD rating)
Baa3 (S)
02/08/19
Fitch (USD rating)
BBB (N)
09/08/19
S&P
BBB- (S)
23/02/18
Russia’s credit ratings have been improving and all three ratings agencies have returned Russia to “investment grade” status (BBB- or more by S&P and Fitch, Baa3 by Moody’s).
Moody’s rates Russia at Baa3 with stable outlook on both its foreign and local currency debt.
Moody’s last upgraded Russia from Ba1 (Positive) in January 2018 as the economy started to emerge from several years of recession. The lowest rating the country had was B3 in August 2008 following the collapse of the ruble that year and technical default on the GKO state treasury bills. The highest the country has scored was Baa1 in March 2013 as economy bounced back from the 2008 crisis.
Fitch rates Ukraine at BBB- on both its foreign and local currency debt with no outlook indicated.
Fitch has been a lot more upbeat on Russia and has consistently ranked if with a treble B rating since 2004 of one sort or another, as it take more account of Russia rock solid fundamentals – the low external debt and large currency reserves. The lowest rating it had was CCC in August 2008 following the currency meltdown. The highest rating was Baa1 in March 2013 thanks to the economic rebound that year.
Standard & Poor’s (S&P) rates both Russia’s foreign debt at BBB- with stable outlook and the local debt at BBB.
S&P has also been fairly consistent on Russia’s rating. Its lowest grade was BB+ (negative) awarded in January 2015. The highest was BBB awarded in December 2008.
8.5 Fixed income
Government issues account for half of Russia’s bond market for the first time since 2014, after the state doubled its borrowing plan last year to fund spending to help shield the economy from the Covid-19 pandemic. With foreign interest in the notes waning in the face of U.S. sanctions, the Finance Ministry lured local investors by selling floating-rate bonds -- potentially costlier debt the government is now looking to retire.
During the height of the tensions over the Russian build up of troops on the Ukraian border non-resident investors sold OFZ. Russia’s state owned banks stepped into the breach so even as the overall volume of OFZ was going up, the share of non-resident investors fell to around 19%. In the April
113 RUSSIA Country Report June 2021 www.intellinews.com