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Moody's Says Greek Default 'Virtually Certain'


The ratings agency has intimated that "a default on Greek government bonds is virtually 100 percent."

The ratings agency has intimated that "a default on Greek government bonds is virtually 100 percent."

Moody's Investors Service says it has downgraded Greece's sovereign debt rating by three notches, leaving it one notch away from default, and warned creditors would lose out from the latest bailout deal.

The ratings agency said in a statement on July 25 that "the combination of the announced EU support program and debt exchange proposals by major financial institutions implies that private creditors will incur substantial economic losses on their holdings of government debt."

It said that the announced EU program along with the Institute of International Finance's statement (representing major financial institutions) implies that "a default on Greek government bonds is virtually 100 percent."

The move comes after another rating agency, Fitch, warned that it too expected the deal would mark a "selective" debt default by Athens.

compiled from agency reports
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