Yesterday both Moody’s and S&P released their rating of Petrobras Global Finance B.V.’s proposed new global notes, which will be unconditionally guaranteed by Petrobras.  Moody’s gave it a Ba3 rating accompanying the rationale behind it that the Ba3 global scale rating reflect the high debt levels and business plan execution risk and, to a lesser extent, potential negative impact from fines related to the Lava Jato investigation.

S&P Global Ratings assigned its ‘BB-‘ debt rating explaining that the rating of the notes follow its corporate credit assigned to Petrobras and that even if it ranked behind the debt issued by subsidiaries in the capital structure, the risk of subordination is mitigated by a priority debt ratio that is far less than 50% and the material earnings generated on the parent level.

Sources: Press releases and Beard Group Inc.