The agency said: This reflects our understanding that ADY was three business days late on a payment on one of its commercial loans in November due to a delay in approval of another loan by the Ministry of Finance, aimed at covering its liquidity gap. As a result, we consider that there is a lack of evidence that the Republic of Azerbaijan has processes and procedures in place to enable effective governance, monitoring, and control of ADY. Reflecting our ongoing concerns regarding a lack of transparency in communication and provision of information from ADY, we are revising downward the stand-alone credit profile (SACP) to 'b-' and we now assess ADY's liquidity as "less than adequate".

"We understand that some of the bureaucratic procedures requiring ADY to obtain permission from the government to enter a new loan agreement took longer than usual due to a strategic governmental review that the company is currently undergoing. We understand that the government is now working on a new regulation and strategy for the railways, and that it has recently transferred responsibility for ADY from the Ministry of Transportation to the Cabinet of Ministers.

"As a result of the delayed payment, we have revised downward our assessment of the link between ADY and the government to "strong" from "very strong", as we no longer have sufficient evidence that processes and procedures are in place to enable effective governance, monitoring, and control over the GRE. We have consequently lowered our assessment that the government would provide timely and sufficient extraordinary support to ADY to "high" from "very high". We continue to assess ADY's role to the government as "very important".

"We have also revised our assessment of ADY's SACP to 'b-' from 'bb-' reflecting a "less than adequate" liquidity. Our assessment of ADY's management and governance remains "weak" reflecting our ongoing concerns in relation to the transparency in communication and provision of timely information from ADY."