Feb 7 Fitch downgraded Ukraine's long-term foreign currency Issuer Default Rating (IDR) to 'CCC' from 'B-', citing political instability in the country.
Ukraine is struggling to prop up its currency amid a political crisis with anti-government demonstrators taking to the streets to protest against a move closer to Moscow's economic orbit. A debt crisis has left the country on the verge of bankruptcy.
"The financial system remains fragile, burdened by non-performing loans of 30 percent, and represents a contingent liability to the sovereign...," Fitch Ratings said.
Fitch said the falling reserves, a weak outlook for its currency and reducing prospects of Ukraine's access to external funding undermine its debt servicing ability.
Fitch ratings also cut the country's short-term foreign currency IDR to 'C' from 'B'.
Russia suspended a $15 billion bailout last week after President Viktor Yanukovich, in a concession to protesters, sacked the pro-Russian prime minister.
Ukraine's central bank on Thursday introduced restrictions on certain types of foreign exchange purchase to help defend the stability of its banking system.
The hryvnia fell below 9 per dollar on Wednesday for the first time in five years. It traded at 8.53/8.56 against the dollar on Friday at 1430 GMT.