Fitch reviews Rio Oil Finance Trust

Fitch Ratings said it placed the following Rio Oil Finance Trust issuances on Rating Watch Negative: the BB+ rating on its $2 billion series 2014-1 notes; the AAsf(bra) rating on its R$2.4 billion series 2014-2 special indebtedness interests; and the BB+ rating on its $1.1 billion series 2014-3 notes.

The ratings address timely payment of interest and principal on a quarterly basis.

Fitch said the Negative Watch reflects the potential impact the waiver conditions approved by bondholders might have on the transaction's coverage levels in case some of the milestones are not met within the waiver period. Milestone completion would subordinate other obligations to the transaction debt service and partially decrease the step-up coupon, lessening the impact of the initial waiver conditions.

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