Interestingly enough, the SP move trails the Chinese Dagong Ratings Agency which cut Greece to CCC on June 3.
Dagong downgraded the UK last month and has cut the US to A+ last year.
Reuters
SP Downgrades Greece, Says Default Likely
Greece on Monday became the country with the lowest credit rating in the world after Standard & Poor's downgraded it by three notches, saying the agency would consider a likely debt restructuring as a default.
A restructuring of Greece's debt -- either with a bond swap or by extending maturities on existing bonds -- looks increasingly likely to be imposed by European policymakers as a means of sharing the burden of Greece's crisis with the private sector, S&P said in a statement.
"In our view, any such transactions would likely be on terms less favorable than the debt being refinanced, which we, in turn, would view as a de facto default according to Standard & Poor's published criteria," the agency said.
In such a case, S&P added, Greece's credit rating would be lowered to "selective default," or SD, while the ratings on the country's debt instruments would be cut to D.
S&P cut Greece's long-term sovereign credit ratings to CCC, just four steps away from default, from B. The short-term rating was affirmed at C and all the ratings were removed from credit watch.
The outlook on the long-term rating remains negative, however, in a sign that another downgrade is likely in the next 12 to 18 months.
