Standard & Poor's Ratings Services said it lowered its rating on Jefferson County, Ala.'s series 2004A, 2005A-1, 2005A-2, 2005A-3, 2005A-4, and 2005B warrants to D from B.

"We believe there was a distressed exchange between the county and its creditors for these warrants and that the county did not honor its original agreement to warrant holders," said Standard & Poor's credit analyst Brian Marshall. In our view, the distressed exchange occurred when the county emerged from bankruptcy on Dec. 3, 2013. At that time, the series 2004A and multiple series 2005A and 2005B warrants became governed by a materially different indenture, with reduced payments to bondholders.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.