Debt

BELGRADE - Serbian President Aleksandar Vucic said at a Serbia-Japan business forum in Belgrade on Thursday Serbia would by the end of this year get investment-grade credit ratings from the Fitch and Moody's rating agencies as well.

Both new applications and debt settlements through the extra mechanism for debt settlement recorded a significant increase in September compared to the same month in 2023.

The number of young people up to the age of 25 who are heavily in debt is on the rise in Bulgaria, with the fastest-growing demographic being young individuals, even those with stable incomes. Financial mismanagement is primarily to blame, particularly among men, who tend to incur more debt than women.

Debt management companies are diving into the hard core of the private debt owed to banks and, mainly, funds that have bought the bad loans, and have so far succeeded in streamlining loans amounting to approximately 10.3 billion euros out of the total of €98 billion they undertook to be managed, with an emphasis on those from 2021 onwards.

Bulgaria ranks 35th in the 2023 list of the wealthiest countries, with net financial assets per capita amounting to 16,410 euros. The Global Wealth Report, released by Allianz, highlights a notable increase in global financial assets of private households, which rose by 7.6%, offsetting a previous decline of 3.5%.

Credit ratings agency Moody's changed Eurobank's and National Bank's outlook for their Baa2 senior unsecured debt and long-term deposit ratings to positive from stable, "following the outlook change to positive from stable in the Government of Greece's Ba1 issuer rating."

Moody's is the only one among major credit ratings agencies that has not given Greece's debt an investment grade.

The Public Debt Management Agency (PDMA) has already drawn from markets €8.7 billion out of the planned €10 billion through bond issues. Thus, another issue is still a possibility, although several experts caution this is not necessary, and that the outstanding amount can be easily covered via the three planned reissuances.

A new round of ratings assessments for Greece's debt will begin in September. DBRS will start on September 6, followed, a week later, by Moody's, the only one of the credit rating agencies that has not bestowed an "investment grade" rating on Greece.

The "favorable arrangements" announced by governments always concern those who have not been consistent with their obligations toward the state and need a second chance. The state is doing well to grant it to them.

Debtors to the state should have a reason to worry. Tax authorities are not only ready to pounce regarding existing debt, by freezing bank accounts and garnishing wages, but will also move against people with the potential not to pay their direct or indirect taxes.