Fitch cuts Russian utilities

Fitch Ratings said it downgraded Russian utilities to CC. The companies were on negative watch, Fitch typically does not assign outlooks or apply rating watches to ratings of CCC or below.

“The sanctions and Russia's restrictions are both broad and targeted on certain sectors and corporates. They include limits on companies' ability to transfer money overseas to meet new foreign liabilities and require exporters to convert 80% of export receipts into Russian rubles. We expect restrictions to tighten further, elevating risk of acute loss of domestic economic confidence, and increasing the risk that timely payment of coupon or principal on borrowings by corporates may be adversely affected,” the agency said in a press release.

The agency cut Federal Grid Co. of Unified Energy System from B, RusHydro’s foreign-currency IDR from B and local-currency IDR from B+ and RusHydro Capital Markets DAC.

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