S&P cuts Venezuela to SD

Standard & Poor's said it lowered its long- and short-term foreign currency sovereign credit ratings on the Bolivarian Republic of Venezuela to SD from B following the nonpayment of oil-indexed payment obligations.

At the same time, S&P affirmed its B rating on the republic's senior unsecured foreign currency debt and its B long- and short-term local currency sovereign credit ratings. The outlook is stable.

On Oct. 15, Venezuela owed an estimated $35 million on oil-indexed payment obligations that were originally issued in conjunction with the government's bank-debt restructuring in 1990, according to S&P.

According to the government, the obligations have been out of the money until the last reference period, problems with verifying the exact amounts owed and with the creditor register have resulted in the delay in making the payment, S&P said.

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