Finance
| More

Detroit's Bond Rating Downgraded



Fitch Ratings downgraded Detroit’s bond rating today after the city opted not to make payments on its general obligation bonds.

The move, which was expected, underscores how difficult it will be for Detroit to regain Wall Street’s trust following the city’s Chapter 9 bankruptcy. A lower bond rating may increase the city’s borrowing costs.

Detroit emergency manager Kevyn Orr directed the city to stop making payments on its unsecured bonds after the city filed for bankruptcy July 18.

Fitch’s move to downgrade Detroit from C to D comes as the city approaches an Oct. 1 deadline to make interest payments on $411 million in unlimited tax general obligation bonds and $202.8 million in limited-tax general obligation bonds.

Detroit had already stopped making payments on its $1.5 billion in pension-obligation certificates of participation, although the city continues to make payments on interest-rate swaps that are being treated as secured obligations in court.

View Full Story From Detroit Free Press

If you enjoyed this post, subscribe for updates.

Comments



Add Your Comment

You are solely responsible for the content of your comments. GOVERNING reserves the right to remove comments that are considered profane, vulgar, obscene, factually inaccurate, off-topic, or considered a personal attack.

Comments must be fewer than 2000 characters.

Latest from Finance



Jobs in Finance

Browse thousands of available finance jobs. Find a finance job with detailed, free information on key career areas in finance. Or post a job.

View or Post Finance Jobs

Finance Newsletter

Our monthly email newsletter provides an exclusive review of issues relating to financing of government operations, including taxation and revenue, budget policy, bond financing and public pensions (monthly).

View Sample

Subscribe to GOVERNING Newsletters

 


© 2011 e.Republic, Inc. All Rights reserved.    |   Privacy Policy   |   Site Map