S&P: the rating of Kyiv ‘B -‘ due to the accumulated accounts payable

Despite the significant amount of financial balances accumulated in the accounts of Kiev, the city’s access to external sources of liquidity remains uncertain.

The international rating Agency S&P Global Ratings has affirmed the long-term credit rating of Ukraine’s capital Kyiv at ‘B -‘ with a stable Outlook.

S&P believes that the level of contingent liabilities of Kiev high due to the accumulated accounts payable utility companies and expects that the city can support utilities by increasing the amount of the grants or providing the capital injection.
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As the Agency notes on its website in years 2017-2019 strong financial performance and a significant amount of funds Kiev will compensate for the uncertainty associated with a system of regional (municipal) Finance, and the possible realization of contingent liabilities.

By Agency estimations, despite the significant amount of cash balances accumulated in the accounts of Kiev, the city’s access to external sources of liquidity remains uncertain.
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The Agency also includes in the contingent liability of the city the remaining part of Eurobonds for $ 101 million, restructuring which is not yet complete.

“Even if the city will have to pay these liabilities, we expect that net payments will not have a material impact on its liquidity position”, – stated in the message.

The international rating Agency S&P Global Ratings may 12 affirmed the long-term and short-term sovereign credit ratings of Ukraine in foreign and national currencies at “B-/B” with a stable Outlook.