July 14 Standard & Poor's cut its rating on
Puerto Rico Aqueduct & Sewer Authority's (PRASA) revenue bonds,
backed by the government, by one notch to 'BB'.
Rating agencies have downgraded Puerto Rico's debt ratings
following a new law that allows the U.S. commonwealth's public
corporations to restructure debt, potentially forcing large
losses on bond holders.
"The actions reflect our downgrade of the commonwealth's
general obligation debt," said Standard & Poor's credit analyst
The ratings agency also cut its rating on PRASA's revenue
bonds to 'BB negative' from 'BB positive' with the outlook being
The negative outlook affects PRASA's series 2008A and 2008B
revenue bonds, of which $285 million are outstanding.
Standard & Poor's has also cut PRASA's stand-alone credit
profile (SACP) to 'bb negative' from 'bb positive'.
(Reporting By Tanvi Mehta in Bangalore)