S&P's analysis is in sharp contrast with the ratings given to the 10 provincial governments by domestic ratings agencies during May's municipal bond pilot program launched by the central government.

Despite the 10 involved varying in wealth - from rich municipalities such as Beijing and Shanghai to poor inland provinces and regions such as the Ningxia Hui autonomous region and Jiangxi province - the bonds issued by them unanimously received AAA ratings which entitled them to interest rates in line with central government bonds.

The three domestic agencies involved in the ratings declined to comment.

S&P's findings echoed those in an earlier National Audit Office survey, however, that showed vastly different debt to fiscal revenue ratios.

Beijing government's direct debt, for instance, is equivalent to about 100 percent of its fiscal revenue, the highest among provinces, followed by the municipality of Chongqing and Guizhou province, each with a more than 90 percent ratio.

Ivan Chung, senior vice-president at Moody's Investors Service Inc, said although financial profiles differ from region to region the gap in reality is narrowed by the central government's transfer payment system, and unlike the federal system, a region's repayment ability cannot be viewed individually.

Domestic agencies usually have less stringent rating standards than their international peers. Lenders widely view regional government bonds as carrying an implicit government guarantee, according to Chung, even though the central authorities have made it clear the 10 governments are expected to issue and repay the debt on their own.

"This is an extremely important trial bond program for the central government so investors believe Beijing is not going to let them fail. Moreover, the bond amounts issued through the program are very small while there are many bidders contributing to the low interest rate," Chung said.

As the program expands in geography and size, greater differences in pricing might occur, he said.

S&P also said in its report that several provinces have already seen low single-digit growth in general budget revenues, far below their 20 to 30 percent average yearly growth over 2010-12.