Fitch affirms Russian Railways

Fitch Ratings said it affirmed JSC Russian Railways' long-term foreign- and local-currency issuer default ratings at BBB+, short-term foreign- and local-currency issuer default rating at F2 with negative outlook, national long-term and senior unsecured ratings at AAA(rus) with stable outlook.

The ratings are aligned with those of the sovereign and reflect the company's 100% state ownership and its strategic importance given the country's vast terrain, as well as state involvement in tariff-setting and the provision of state subsidies for the loss-making passenger division, Fitch said.

The outlook on its long-term foreign- and local-currency issuer default ratings were revised to negative from stable following the revision of the sovereign's outlook to negative from stable.

Russian Railways is expected to remain the monopoly operator of Russia's rail infrastructure, the agency said, with a dominant position in the provision of locomotives and rolling stock after the completion of rail reforms.

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