Brief-S&P Raised Cyprus Long-Term Ratings To 'B' On Better-Than-Expected Economic And Budgetary Performance; Outlook Positive

Fri Apr 25, 2014 3:29am EDT

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(The following statement was released by the rating agency)

April 25 -

OVERVIEW

Cyprus appears to be meeting the terms of the Economic Adjustment Program financed by the European Stability Mechanism and International Monetary Fund, suggesting reduced risk to Cyprus' full and timely payment of its debt service.

Cypriot GDP contracted less than we projected last year, and we think Cyprus will likely repeat its 2013 outperformance of budgetary targets in 2014.

We are therefore raising our long-term sovereign credit ratings on Cyprus to 'B' from 'B-' and affirming our short-term sovereign credit ratings at 'B'.

The positive outlook incorporates the possibility that we could again raise the rating on Cyprus within the next 12 months if it continues to comply with the Economic Adjustment Program.

RATING ACTION

On April 25, 2014, Standard & Poor's Ratings Services raised its long-term foreign and local currency sovereign credit ratings on the Republic of Cyprus to 'B' from 'B-'. At the same time, we affirmed our short-term foreign and local sovereign credit ratings at 'B'. The outlook is positive.

RATINGS LIST

Upgraded

To From

Cyprus (Republic of)

Sovereign Credit Rating B/Positive/B B-/Stable/B

Senior Unsecured B B-

Ratings Affirmed

Cyprus (Republic of)

Transfer & Convertibility Assessment AAA

Short-Term Debt B

Commercial Paper B

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