Moody’s revises Argentina to negative

Moody's Investors Service said it affirmed Argentina's Caa1 issuer rating, which also applies to domestic law bonds, confirmed the provisional Caa2 rating for its foreign law bonds and affirmed the Ca rating on the original defaulted bonds.

The long-term issuer rating was placed on negative outlook. This action concludes the review, direction uncertain, of Argentina's foreign law bond rating initiated on July 2.

As of July 30, holders of Argentine foreign legislation bonds restructured in 2005 and 2010 had not received their scheduled payment, following a 30-day grace period from the original June 30 payment date. Even though Argentina deposited the required funds into a trustee account on June 26, legal proceedings in the U.S. impeded disbursement of these funds by the trustee, Moody’s said.

Argentina's government has stated that it will continue making payments to the trustee, but that it will not pay litigating bondholders at this time.

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