28 Oct 2010 14:52

City of Moscow Proposed Series 53 Bond Due 2013 Rated 'BBB' - S&P

MOSCOW. Oct 28 (Interfax) - On Thursday, Standard & Poor's Ratings Services said that it had assigned its 'BBB' senior unsecured debt rating to a proposed domestic bond, series 53, which the City of Moscow (BBB/Stable/--) plans to place on October 28, 2010, for Russian ruble 15 billion. The bond matures in 2013 and has six remaining semiannual coupon payments with a fixed step-down coupon rate, the agency said in a statement.

"The city is issuing the bond to finance its capital program," Standard & Poor's credit analyst Felix Ejgel was quoted as saying. "The ratings on the bond are equalized with the rating on the city," he said.

The statement said: "The rating on Moscow reflects the city's position as Russia's economic, administrative, and financial center, as well as its diverse, service-based economy, with wealth levels well above the national average. The rating is also supported by Moscow's currently low debt service, within 7% of total revenues until 2015; its cautious debt management; and strong operating budgetary performance.

"The rating is constrained by the limited predictability and flexibility of budgetary policies, emergent long-term planning, and rising contingent liabilities."