Fitch trims Yuyao Shuncai Investment

Fitch Ratings said it downgraded Yuyao Shuncai Investment Holding Co., Ltd.'s long-term foreign- and local-currency issuer default ratings to BB+, from BBB-. The agency also lowered YSIH's guaranteed U.S.-dollar notes to BB+ from BBB-. The notes were issued by Yuyao Economic Development Zone Construction Investment and Development Co., Ltd., which YSIH wholly owns.

“The downgrade follows Fitch's revision of its perception of Yuyao city's ability to provide subsidies, grants and other legitimate resources allowed under China's policies and regulations. This reflects a deterioration in the city's fiscal performance and leverage, stemming from reduced operating and capital revenue, combined with a sharp increase in expenditure,” the agency said in a press release.

The outlook is stable.

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