S&P rates Venezuela bonds B

Standard & Poor's said it assigned its B long-term foreign currency rating to the Bolivarian Republic of Venezuela's planned $1.5 billion bond due in 2014 and affirmed its B long- and short-term foreign and local currency sovereign credit ratings on the republic.

The outlook is stable.

According to S&P credit analyst Richard Francis, the ratings reflect the balance between increased financial flexibility due to high oil revenue and the high fiscal deficits, political polarization and diminished economic prospects that continue to constrain Venezuela's creditworthiness.

"Following the victory of President Hugo Chavez in the Aug. 15 referendum on his presidency and the independent verification by international observers (including an audit of the results), political instability is likely to diminish - although the country remains highly polarized," Francis said.

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