ABH Financial Ltd.#s Proposed Senior Unsecured Loan Participation Notes Rated #B+#

Stocks and Financial Services Press Releases Friday March 17, 2017 17:43
MOSCOW--17 Mar--S&P Global Ratings

MOSCOW (S&P Global Ratings) March 17, 2017--S&P Global Ratings said today that it has assigned its 'B+' long-term issue rating to the proposed euro-denominated senior unsecured loan participation notes (LPNs) to be issued by ABH Financial Ltd. (B+/Positive/B) via its special-purpose vehicle (SPV), Alfa Holding Issuance PLC.

ABH Financial Ltd. is a nonoperating holding company and the parent of Russia-based Alfa-Bank. Alfa Holding Issuance PLC will issue the notes under the €1.2 billion program that finances loans to ABH Financial Ltd. The rating is subject to our analysis of the notes' final documentation. We currently understand that the targeted amount of the proposed issue is subject to market interest, within the unutilized program limit. The maturity of the issue is to be up to five years, subject to market conditions.

The final terms of the notes are to be defined at the time of their placement. Subject to certain conditions, we rate LPNs issued by an SPV at the level we would rate equivalent-ranking debt of the underlying borrower (the sponsor) and we treat the contractual obligations of the SPV as financial obligations of the sponsor.

The relevant conditions are:
All of the SPV's debt obligations are backed by equivalent-ranking obligations with equivalent payment terms issued by the sponsor;

The SPV is a strategic financing entity for the sponsor set up solely to raise debt on behalf of the sponsor's group; andWe believe the sponsor is willing and able to support the SPV to ensure full and timely payment of interest and principal when due on the debt issued by the SPV, including payment of any of the SPV's expenses.

We consider that the proposed LPNs to be issued by the SPV, Alfa Holding Issuance PLC, meet all these conditions.

The rating on the proposed notes is therefore 'B+', the level we would rate equivalent-ranking debt of the underlying borrower, ABH Financial Ltd. The rating is subject to our analysis of the final documentation on the notes.


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