Slovenia proved its doubters wrong when it issued a hugely over-subscribed US$3.5bn bond deal, just two days after a credit rating downgrade to junk status by Moody’s, IFR Markets said in a commentary on Friday. According to a portfolio manager, the downgrade was damaging to the credibility of rating agencies.
The bond sale yesterday came two days after the country was forced to suspend the original transaction in the face of Moody’s unexpected downgrade by two notches. That day, some US$12.5bn of orders had been listed.
“It’s scandalous. It shouldn’t be allowed to happen,” IFR Markets quotes one of portfolio managers as saying. “The credibility of ratings agencies is eroded by actions such as these.”