Fitch rates Puerto Rico's $3.5 billion GO Bonds 'BB'

March 4 Tue Mar 4, 2014 3:55pm EST

March 4 (Reuters) - Fitch assigned a 'BB' rating to Puerto Rico's planned issuance of up to $3.5 billion general obligation (GO) bonds, citing weakness in the country's economy, high debt and unfunded pensions.

Puerto Rico's governor signed a bill on Tuesday authorizing the bond sale. Sources familiar with the matter told Reuters the issuance is likely to be priced next week.

The agency assigned a negative outlook on the bonds. It also affirmed its 'BB' rating on Puerto Rico's $10 billion of outstanding GO bonds.

Puerto Rico has about $70 billion of outstanding debt and has long struggled with a shrinking economy and population.