PARIS (AFP) ― The international ratings agency Fitch said Wednesday that it has cut the long-term rating on Greece’s sovereign debt by two notches, from “CCC” to “C.”

A Fitch statement said it now considered that a Greek debt default was “highly likely in the near term.”

The agency said the downgrade followed Tueday’s hard won agreement for a second rescue of Greece, which includes a 53.5 percent writedown on private holdings of the country’s sovereign debt through a bond swap scheme.

The writedown, worth 107 billion euros ($142 billion), is intended to help reduce the country’s debt mountain of 350 billion euros to more manageable levels.

Fitch warned the rescue’s debt exchange with private creditors “will, if completed, constitute a rating default,” and result in the country’s rating being lowered accordingly.

But Fitch said that shortly after completion of the exchange, Greece’s sovereign rating will be moved out of the “RD” (restricted default) category and “re-rated at a level consistent with the agency’s assessment of its post-default structure and credit profile.”

Bankers, insurance companies and hedge funds that hold Greek government bonds will get precise proposals in the coming days on the debt swap, and will then decide whether to take a 53.5 percent loss on their holdings.