(The following statement was released by the rating agency)
Nov 08 -
-- We expect the budgetary performance of the Russian LRG Stavropol Krai to be weaker in 2012-2014 than in our previous forecast due to rapid operating spending growth.
-- Nevertheless, the management's intention to achieve a balanced budget and to gradually improve the debt maturity profile should help improve the krai's currently negative liquidity position in the next three years.
-- We are affirming our 'B+' rating and 'ruA+' Russia national scale rating on the krai.
-- The stable outlook reflects our view that in 2013-2014 Stavropol Krai will continue to be exposed to refinancing because of a modest accumulation of direct debt, but that its current liquidity position will not deteriorate, thanks to a gradual shift to medium-term borrowings and improvement of the debt maturity profile.