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Budapest rating not affected by principal payment delay, says S&P

Standard and Poor's Ratings Services on Thursday said the ratings of Budapest are not affected by the Alliance of Hungarian Local Governments' request that Prime Minister Viktor Orbán allow the country's local and regional governments the option to delay principal repayments of Swiss franc-denominated local government debt.

According to Standard and Poor's criteria, any such payment delays or deferrals beyond five business days after the due date could be qualified as a default, the ratings agency said. "Nevertheless, we understand that Budapest, the only Hungarian LRG with a public rating from Standard and Poor's, has no Swiss franc denominated debt outstanding and would therefore not be affected by this proposal," it said.

"We further understand that Budapest is committed to making all payments in full and on time, which our investment-grade rating reflects," it added.