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14.09.2007
Bond issues by INVEST-FINANCE LLC assigned uaB- credit rating
Credit-Rating, a nationally-recognized credit rating agency in Ukraine has today announced the assignment of uaB- (uaB minus) long-term credit rating to UAH39.3m and UAH6.5m 2-year issues of registered housing bonds by Kiev-based INVEST-FINANCE LLC (`Issuer` or `company`). The company`s principal activity is investment and construction. Today the company constructs a residential building with installed underground parking and social facilities in the city of Kiev. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2004-2006 and 1Q2007 as well as other inside information furnished by the company.
An obligor or a debt liability with uaB credit rating is characterized with the LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is extremely susceptible to adverse changes in commercial, financial and economic conditions. The plus (+) or minus (-) modifier denotes rating`s relative status within major categories.
Factors maintaining the credit rating
- The bond issues are to be redeemed by residential premises in 70, Artyoma str., Kiev, which has already been invested 8% of the overall project`s estimated cost.
- The Issuer is involved in construction of the residential building in the Kiev`s city centre, where demand for real estate is stably high.
Factors constraining the credit rating
- The Issuer does not have experience in investment and construction projects, neither in bonds` redemption.
- The company`s total liabilities on 2 housing bond issues for UAH45.8m exceed 2x Issuer`s assets of UAH22.6m as of March 31, 2007, and 10x Issuer`s equity of UAH4.7m.
- Issuer`s detrimental performance in 2004-2006 and 1Q2007 with the uncovered loss amounting to UAH(-)0.35m as of March 31, 2007.
- Instability in legislation and tax environment controlling both the construction industry and project financing.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may be found in REUTERS, BLOOMBERG and FTN MONITOR information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
