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EU bans credit rating agencies from doing business with Russia

On Tuesday, the European Union said credit rating agencies had been prohibited from rating Russia’s sovereign debt and the country’s companies.

This will take effect from Tuesday, according to the commission.

The EU, in a statement outlining the content of the fourth package of punitive measures, said the ban would “result in them losing even further access to the EU’s financial markets’’ as a result of the invasion of Ukraine.

Companies that assign credit ratings ascertain a debtor’s ability to pay back debt by making timely principal and interest payments, as well as the likelihood of defaulting on that debt.

The package agreed upon by EU leaders at a summit last week blocks Russia’s access to funds from the International Monetary Fund (IMF) and the World Bank and moves to strip Russia of its “most favoured nation’’ status at the World Trade Organisation (WTO).

The sanctions also ban EU investment in the Russian energy sector and the country’s military-industrial complex.

Wary of energy supply disruptions, the bloc resisted targeting Russian energy imports despite strong criticism from Poland, Latvia and Lithuania.

(dpa/NAN)

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