Fitch Rates Russia's Tula Region 'BB'; Outlook Stable

Wed Oct 30, 2013 12:41pm EDT

Link to Fitch Ratings' Report: Tula Region - Rating Action ReportMOSCOW, October 30 (Fitch) Fitch Ratings has assigned Russia's Tula Region Long-term foreign and local currency ratings of 'BB', a Short-term foreign currency rating of 'B' and a National Long-term rating of 'AA-(rus)'. The Outlooks for the Long-term ratings are Stable. The rating action also affects the region's RUB3.5bn senior unsecured domestic bond (ISIN RU000A0JT1G2). KEY RATING DRIVERS The ratings reflect the region's moderate direct risk, satisfactory operating performance and an absence of contingent liabilities. The ratings also factor in continuous pressure on operating expenditure due to an evolving national institutional framework and the region's weak debt coverage exceeding its debt maturity profile. The key rating drivers and their relative weights are as follows: High: Fitch expects Tula's direct risk will remain moderate in 2013, with direct risk close to 25% of current revenue, up from 21.5% in 2012. Fitch does not expect direct risk to exceed 30% of current revenue up to 2016. The region is free from contingent liabilities, which is credit-positive. Fitch views the region's immediate refinancing risk as moderate.International Local and Regional Governments Rating CriteriaAdditional Disclosure Solicitation StatusALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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