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20.12.2006
Credit ratings assigned to bond issues by the city of Zaporizhya affirmed
"Credit-Rating", a nationally-recognized credit rating agency in Ukraine has today affirmed the uaA- (uaA minus) long-term credit rating with Stable Outlook assigned to bond issue by the city of Zaporizhya for the amount of UAH 25m with the 2 Ѕ -year original maturity and the uaBBB+ (uaBBB plus) long-term credit rating with Positive Outlook assigned to the bond issue by the city of Zaporizhya for the amount of UAH 75m with the 5-year original maturity. To affirm the ratings the agency took into consideration city`s 1H 2006 financial and economic indicators, as well as other inside information furnished by the city council.
The uaA issue rating reflects obligor`s strong capacity to pay debt liability given, it may, though, be more vulnerable to adverse changes in economic, financial and business conditions than debt liabilities rated uaAA and uaAAA. The "+" and "-" modifiers denote rating`s relative status within major categories. Stable Outlook exhibits that there are no conditions to change rating in the course of the year.
The uaBBB issue rating reflects adequate capacity of an obligor to timely and in full pay the given debt liability in the Ukrainian financial market environment, there is, though, a higher vulnerability to the effect of adverse changes in business, financial and economic conditions as compared to debt liabilities with higher ratings. The "+" and "-" modifiers denote rating`s relative status within major categories. Positive Outlook exhibits that there is a possibility of a rating`s upgrade in the course of the year on condition that the positive tendencies are retained and the current risks are reduced.
Factors supporting the credit rating
- Retaining of positive labour market development tendencies over 1H 2006, as compared to 2005, specifically the decrease in registered level of unemployment by 0.14 percentage points (to 0.6%) which is 4.5x less than that average in Ukraine, increase in number of employed and in average wage by 18% (to UAH 1,141.8)
- Growth in 1H 2006 city`s indicators as compared to the similar period of 2005, specifically increase in investments into city`s fixed capital by 6.4% (it is 30% more (calculated per capita) than that average of the country), retail turnover growth by 29% (the per capita indicator is 63% higher than that average of the country), 5.8% growth in export turnover (the per capita indicator is 2.5x higher than that average of the country).
Factors constraining the credit rating
- Growth in wage arrears. The indicator given grew by 25.7% over the period analyzed and amounted to UAH 4,658.6
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may be found in the REUTERS and BLOOMBERG information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
