Ecuador’s country risk drops 643 points and S&P improves the bond rating
Due to the new agreement with the International Monetary Fund (IMF) and the progress in the process of renegotiating the external debt in bonds, Ecuador’s country risk was reduced this September 1 by 643 points . In this way, the index fell from 2,813 to 2,170 points in a single day, which means that international markets have a better perception of Ecuador in terms of the payment of its debts.
As a consequence of the drop in oil prices and the decrease in tax revenues due to the health emergency, in March of this year Ecuador registered a conspicuous rebound in country risk that exceeded 5,000 points .
Parallel to the drop in country risk, S&P Global Ratings announced that Ecuadorian bonds improved their rating.
S&P Ratings reported that on September 1 it raised its sovereign credit ratings in foreign and local currency of Ecuador from “SD / SD” (selective default) to “B- / B”.
The US $ 16.5 billion of new debt issued by the government in three bonds, maturing in 2030, 2035 and 2040, and a maturing interest security (PDI) were also rated B-.
Since last July, this is the second important drop that country irrigation has registered in Ecuador, precisely because in that month the Government announced that it had reached an agreement with the bondholders. On that occasion, the risk dropped from 3,259 points to 2,783 points.
The rating firm passed the Ecuadorian social bond from CCC- to B-. In addition, S&P reported that the transfer and convertibility assessment of CCC- to B- was analyzed. (I)