Yesterday Fitch, the rating firm downgraded South Cyprus to B- from B.
This takes the country’s financial rating even further into junk territory.
Fitch also said that it would keep the country on negative watch, suggesting that there may be further downgrades in the next few years.
South Cyprus facing bankruptcy, negotiated a 10 billion euro bailout from the EU and IMF in March.
Fitch analysts feel that there will be major risks in the implementation of this programme and that the South Cyprus economy is too weak to take any shocks. It also sees little potential for the government to replace the much diminished finance sector.