Moody's rates Vologda Ba1

Moody's Investors Service said it assigned Ba1 global scale local- and foreign-currency ratings to the Oblast of Vologda, and Moody's Interfax Rating Agency affirmed the oblast's Aa1.ru national scale rating.

The outlook is stable.

The agency said the ratings are supported by the oblast's sustainable economic growth in the recent past as well as the oblast government's prudent budget policy, good credit history and very low debt burden.

At the same time, the ratings are constrained by the oblast's considerable exposure to a single taxpayer, OAO Severstal, and weakening operating balances due to growth in operating expenditure and an expected decrease in tax proceeds as the economy decelerates in 2009, Moody's said.

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