S&P keeps Greece rating at selective default

ATHENS (Reuters) - Standard & Poor's said on Thursday it would keep its long-term foreign sovereign credit rating for Greece at selective default until the country's bond swap is fully concluded.

Earlier this week, Fitch became the first ratings agency to move Greece out of default territory, assigning the country a speculative B- rating. But S&P said it would likely raise its rating to CCC - extremely speculative - only once Greece's debt restructuring is completed next month, with an exchange of bonds governed by international law.

"Our sovereign credit ratings on Greece will remain at SD until the exchange of Greece's non-Greek-law governed bonds is concluded, which we understand is to occur by April 11, 2012," S&P said in a statement.

Major rating agencies had warned Greece would be in default territory during the bond swap that shaved about 105 billion euros ($137 billion) off Greece's debt and imposed losses of about 74 percent on private bondholders.

S&P assigned a junk CCC rating on Thursday to the new bonds Greece created earlier this week, when the first and biggest part of its debt restructuring was completed.

The CCC rating reflects Greece's uncertain economic growth prospects and weakening consensus for reforms, S&P said.

Moody's is also expected to issue a statement on Greece soon.

($1 = 0.7651 euros)

(Reporting by Harry Papachristou; Editing by Ruth Pitchford)

Source: http://news.yahoo.com/p-keeps-greece-rating-selective-default-174420578.html

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