Moody's lowers Vologda

Moody's Investors Service said it downgraded the global-scale foreign and local-currency ratings of Vologda Oblast to Ba3 from Ba2.

The outlook is stable.

"The downgrade of Vologda Oblast's ratings reflects the region's weak operating and financing balances over the past few years, as well as its increasing and high debt burden coupled with low liquidity," said Alexander Proklov, a Moody's vice president-senior analyst and lead analyst for Vologda Oblast.

"The region has faced significant volatility in tax revenue, particularly corporate income tax, due to its substantial exposure to key taxpayers in the steel and chemical sectors."

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