Reuters: Bankruptcy News: Detroit water, sewer bonds may still face downgrade-Fitch

Reuters: Bankruptcy News Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

Detroit water, sewer bonds may still face downgrade-Fitch Jul 16th 2013, 20:44 July 16 | Tue Jul 16, 2013 4:44pm EDT July 16 (Reuters) - Fitch Ratings said on Tuesday it is keeping Detroit's water and sewerage revenue bonds on a watch list for potential ratings downgrades amid ongoing uncertainty about the city's unfolding restructuring process. A proposal to creditors by the city's emergency manager last month called for a potential debt exchange that could shortchange some bondholders, although Fitch said there is no apparent legal basis to compel such an exchange. It added that the debt would have "substantial protection" in the event Detroit were to file what would be the biggest Chapter 9 municipal bankruptcy ever. "Fitch sees no apparent reason for bondholders to accept any impairment given the very strong legal position of this debt in a Chapter 9 bankruptcy proceeding," the ratings agency said in a statement. It added that the BBB-plus and BBB ratings on $1.78 billion of sewerage bonds and $1.66 billion of water bonds could fall to C or D, denoting default, should bondholders be impaired.

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions