print
21.04.2008
Credit-Rating rates city of Zaporizhzhia at uaAA-
Credit-Rating, a nationally recognized credit rating agency in Ukraine has today announced that it assigned a long-term credit rating of uaAA- (uaAA minus) to the city of Zaporizhzhia (`City`). Credit-Rating has also assigned a long-term credit rating of uaAA- (uaAA minus) to bearer coupon bonds (series F-H) to be issued by the City. The amount of the issue is UAH60m, due in 2012. The outlook on both ratings is stable. In the course of analysis Credit-Rating considered City`s socio-economic and financial indicators for 2002-2007, as well as information on its municipal property, management system and other inside information.
An obligor or a debt liability with uaAA credit rating is characterized with the VERY STRONG creditworthiness as compared to other Ukrainian obligors or debt liabilities. The plus (+) or minus (-) modifier denotes rating`s relative status within major categories.
Stable outlook indicates that there are no anticipated reasons to change rating in the course of the year.
Factors maintaining the credit rating
- The incomes (excluding transfers) in the budget`s general fund has been growing at rapid rates over the past 3 years, specifically the amount of incomes in 2005, 2006, and 2007 exceeds 21.8, 24.1, 41.2 % respectively to those of the previous budget periods.
- Low City`s direct debt burden as of Jan. 1, 2008 (4.7 percent of the budget incomes excluding transfers) with its moderate growth expected further: the debt burden will make up 8.8 percent of the budget incomes planned for 2008, had the issue is placed in full.
- Growth in majority of City`s key figures, namely the industrial production sales increased 1.7x to UAH41.6bn, the retail sales grew 3.5x to UAH4.7bn, the export goods turnover rose 3x to USD7.3bn; these indicators calculated per capita exceed national averages 3.2x, 1.6x, 3.9x respectively.
- The City`s key social development indicators have improved over 2003-2007, specifically the monthly average wage grew 2.5x to UAH1,560.8, which is 15.5% higher than the national average; the number of employees (excluding small businesses) grew 4.9% to 297.8K, which accounts for 37.8% of the City`s overall population, accompanied by low unemployment rate of 0.6%, which is lower than that national of 2.4%.
Factors constraining the credit rating
- High deterioration of City`s fixed assets, including the housing sector, utilities and transport infrastructure, which require significant investments for their renovations, combined with high population`s arrears for utilities services.
- High pollution of City`s environment, which negatively affect City`s social sector.
Information on all credit ratings assigned in accordance with the National Rating Scale may be found in REUTERS and BLOOMBERG Information Systems.
For more information, please contact:
Information and Communication Department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
