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12.01.2007
Credit rating assigned to the city of Brovary affirmed at uaBBB- (uaBBB minus)
"Credit-Rating", a nationally-recognized credit rating agency in Ukraine has today affirmed the uaBBB- (uaBBB minus) long-term credit rating assigned to the city of Brovary. To affirm the rating the "Credit-Rating" agency took into consideration city`s 1H 2006 financial and economic indicators as well as other inside information furnished by the city council.
The uaBBB issuer 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 the debt liabilities with higher ratings. The "+" and "-" modifiers denote rating`s relative status within major categories.
Factors supporting the credit rating
- Growth in city`s 1H 2006 economic development indicators as compared to the similar period of 2005, specifically the investments into fixed capital grew by 56.7% (this indicator calculated per capita 25.1% exceeds the weighted average country`s indicator), the retail turnover grew by 21.7%, the export turnover by 27.4% (this indicator calculated per capita 22.4% exceeds the weighted average country`s indicator).
- The average monthly wage is 7.2% higher than that weighted average of the country as of 26 Dec. 2006
- No direct debt of Brovary city council as of 26 Dec. 2006
Factors constraining the credit rating
- A number of city`s per capita economic development indicators is lower than that average of the country, specifically the industrial production sales is 42.5% lower, the retail turnover is 2.3% lower.
- Growth rates of monthly wages in 1H 2006 is lower than that average of the country with 2.2x growing wage arrears (up to UAH 0.9m) over the period under report.
- Up to 30% of able-bodied citizens work in the city of Kiev, which constricts the taxation basis of budget revenues from natural person tax, with the retained burden on budget expenditures.
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
