Moody's Investors Service has downgraded the sovereign credit rating of Greece to the lowest level, from ‘Ca’ to ‘C’, the rating agency said.
The agency said on its website that the decision “was prompted by the recently announced debt exchange proposals for Greece, which imply expected losses to investors in excess of 70 percent, which is consistent with Moody's criteria for a C rating.”
Two weeks ago Eurozone officials agreed to a second 130-billion euro ($172 billion) bailout aid package for Greece and called for private investors to waive 53.5 percent of their principal in a bond swap to cut Greece’s massive 360-billion euro debt by 107 billion euros.
Last week international ratings agency Standard & Poor’s downgraded on Tuesday Greece’s long-term sovereign credit rating from ‘CC’ to ‘selective default.’
