March 03, 2014. Standard & Poor’s changed Sverdlovsk Region’s Rating Outlook from Stable to Negative, while at the same time affirming the constituency’s long-term issuer credit rating at BB+, Finam reports.

‘The Rating Outlook was reconsidered due to weaker budget implementation that we had expected. We could point out that, should Sverdlovsk Region fail to improve its budget performance this year, this will weaken its liquidity and increase its debts,’ Standard & Poor’s analysts say.

This Negative Rating Outlook reflects S&P’s vision of stronger risks related to weakened liquidity and growing debt burden.

At the same time, the agency does admit that the constituency’s solvency is positively affected by the economic growth which is above the country average, by the small debt burden, by high liquidity figures, and a moderate amount of contingent liabilities.

The weakening of the financial indicators in 2013 resulted in greater borrowing volumes, so that Sverdlovsk Region’s total debt reached up to 25% of the current consolidated profits, which S&P still thinks is a low figure.