Research Update: Ghana LC Rating Lowered To 'SD' On Domestic Distressed Exchange; FC Lowered To 'CC' With A Negative Outlook

On Dec. 4, 2022, Ghana's Ministry of Finance initiated a transaction that we classify as a distressed exchange offer on the majority of domestic debt instruments, to restore the sustainability of the government's finances and help secure balance-of-payments support from the IMF. As a result, we lowered our local currency (LC) long- and short-term sovereign credit ratings on Ghana to 'SD' (selective default) from 'CCC+/C', reflecting our opinion that the restructuring will result in senior unsecured lenders receiving less than originally promised. . Additionally, the Ministry of Finance announced plans (but no specific offer) to restructure its foreign currency (FC) debt obligations. We therefore also lowered our FC long-term sovereign rating on Ghana to 'CC' from 'CCC+,' and affirmed our

...(Editor's Note: On June 28, 2023, we republished this Research Update to correct an error in the short-term local currency (LC) issuer credit rating. At the time of the original rating action on Dec. 6, 2022, the short-term LC issuer credit rating should have been automatically lowered to '##' in line with the lowering of the long-term LC issuer credit rating to '##'. We have corrected this error by indicating that the short-term LC credit rating on Ghana was lowered to '##' from 'C' and removing the two sentences that said we had affirmed the short-term LC rating at 'C'. No other changes have been made to this publication.)...

Research Update