S&P sees 2nd Greek debt haircut, new downgrade: report
A new and bigger restructuring of Greek debt is likely within the next two years, an official from credit ratings agency Standard & Poor's said on Tuesday, adding a further downgrade of Greece's sovereign debt rating was pretty certain.
The rating has a negative outlook, so we're pretty certain it's going to go lower because, of course, an actual debt restructuring is now on the table, David Beers, S&P's global head of sovereign ratings, told CNBC television.
Greece became the lowest-rated country in the world by Standard & Poor's, which downgraded it 8 notches June 13.
We've also expressed the opinion before that we think that any near-term restructuring is probably not the end of the story. There may be another bigger restructuring down the road, Beers said in an interview.
Asked when the new restructuring might occur, Beers said: That's partly in the hands of Greek politics. But it wouldn't surprise us if a second restructuring had to be looked at over the next couple of years.
Euro zone leaders last week agreed on a wide-ranging new rescue package for Greece that included a private sector bond swap by banks, insurers and other holders of Greek debt.
Creditors will take a 21 percent loss on their Greek bond holdings as part of a 37 billion-euro contribution over the next three years to aid the country.
Moody's cut Greece's credit rating on Monday by three notches to Ca, just one notch above default, to reflect the expected loss implied by the proposed debt exchanges.
Standard & Poor's and Fitch currently rate Greece CCC, broadly in line with Moody's rating. (Reporting by William Schomberg; Editing by Kim Coghill)
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