WASHINGTON, June 30 (Reuters) - Standard & Poor’s Ratings Service said on Monday it was putting Puerto Rico Aqueduct & Sewer Authority under review for potential downgrade, after the territory last week passed a law allowing public corporations to restructure their debts.
The agency rates PRASA BB+. The placement on CreditWatch, with negative implications, affects more than $3.4 billion in debt, the agency said.
The agency expects to conduct the review in step with its broader look at Puerto Rico’s debt, and it could resolve the credit watch if PRASA decides to restructure its debt under a new law within the next 90 days.
Last week, Puerto Rico passed a law allowing its public corporations to restructure their debts in a process akin to filing for bankruptcy. As a result, S&P is evaluating the credit strength of the commonwealth and some of its entities. PRASA has said it will not take advantage of the option. (Reporting by Lisa Lambert; Editing by James Dalgleish)