«Fitch Ratings» agency acknowledged Kharkiv ratings

20 july 2012 17:45

«Fitch Ratings» agency acknowledged long-term and short-term ratings of Kharkiv and loan stocks of Kharkiv city council for 99,5 million hrivnas on «B» level with the steady forecast.

Kharkiv received long-term rating in native currency and foreign exchanges on «B» level, short-term rating in foreign exchanges and national long-term rating «AA-(ukr)». The forecast for long-term ratings of the city is steady. These ratings are spread to Kharkiv loan stocks for 99,5 million hrivnas.

Ratings reflect diversified economy, solid current position and improving budget performance measures. «Fitch» notes that further positive rating actions will depend on increase of sovereign credit rating along with reduction of risk of refunding and ability of the city to retain operating margin on 10% and restrain plain debt on the level of 20% of current revenue.

The economy of the city is diversified in trade wise and service types and is maintained due to great number of companies. Kharkiv economic development exceeds average performance in Ukraine due to diversified economy and developed infrastructure. The city was successful at UEFA EURO 2012 organization.

These factors along with infrastructure development provide near-term outlook on economic development of Kharkiv.

«Fitch» expects plain debt of the city to decrease gradually to less than 10% of current revenue as subsidization borrowing requirement for major projects became much lower after the UEFA EURO 2012 is carried out.