International rating agency Fitch has downgraded Greece's long-term foreign and local currency Issuer Default Ratings to C from CCC and affirmed the short-term foreign currency rating at C, the agency said on Wednesday.

“The downgrade follows yesterday's Eurogroup statement on a second financing program for Greece including 'private sector involvement' and a subsequent announcement from the Greek authorities outlining the terms of the proposed exchange of Greek Government Bonds,” the agency said in a statement.

Eurozone officials agreed early on Tuesday to a second 130-billion euro ($172 billion) bailout aid package for Greece and called for private investors to waive 53.5 percent of their principal in a bond swap to cut Greece’s massive 360-billion euro debt by 107 billion euros.

“In Fitch's opinion, the exchange, if completed, would constitute a 'distressed debt exchange' in line with its criteria and consequently yesterday's announcements set in motion the agency's process for reviewing Greece's issuer and debt securities ratings. The sovereign IDR has accordingly been lowered to C from CCC indicating that default is highly likely in the near term,” the statement said.

The proposal to reduce Greece's public debt burden via a debt exchange with private creditors will constitute a rating default and result in the country's IDR being lowered to Restricted Default upon completion, the statement said.