Fitch Rates ICBCTL's Senior Notes 'AAA(tha)'

Stocks and Financial Services Press Releases Thursday March 26, 2020 10:36
Bangkok--26 Mar--Fitch Ratings
Fitch Ratings (Thailand) has assigned ICBC
(Thai) Leasing Company Limited's (ICBCTL, AAA(tha)/Stable/F1+(tha)) upcoming
long-term senior unsecured notes a National Long-Term Rating of 'AAA(tha)'. The
notes will be issued under ICBCTL's medium-term note programme, which was
affirmed at 'AAA(tha)/F1+(tha)' on 2 September 2019. The size of the programme
has been increased to THB40 billion, from THB30 billion, but this does not
affect the programme's ratings.
The proceeds will be used for refinancing
and general operations.
KEY RATING DRIVERS
ICBCTL's senior notes are rated at the
same level as its National Long-Term Rating as they represent the company's
unsecured and unsubordinated obligations.
ICBCTL's National Long-Term Rating is
based on Fitch's view that the company is a core subsidiary of Industrial and
Commercial Bank of China (Thai) Public Company Limited (ICBCT;
AAA(tha)/Stable/F1+(tha)). ICBCTL has an important role in supporting the
bank's hire purchase, finance lease and factoring business, which comprised 38%
of ICBCT's revenue and profit in 2019. ICBCTL is also closely integrated with
its 100% parent, shares the same brand and continues to receive ordinary financial
support.
RATING SENSITIVITIES
The note ratings are sensitive to changes
in ICBCTL's National Long-Term Rating, which is at the top-end of the scale and
therefore has no upside.
Any changes in the perceived propensity of
ICBCT to support ICBCTL could lead to rating action on the National Ratings of
ICBCTL and its senior debt. This may occur if ICBCT reduces its ownership to
below 75%, withdraws its financial commitment or undertakes actions that
indicate a significantly lower propensity to provide support. ICBCT's ratings
are, in turn, sensitive to a change in its parent's ability and propensity to
provide extraordinary support. However, Fitch believes this is unlikely to
occur in the near term.
For full details on the rating drivers and
sensitivities for ICBCT and ICBCTL, please see our rating action commentary,
Fitch Affirms ICBCT and ICBCTL at 'AAA(tha)'; Outlook Stable, published 2
September 2019.
DATE OF RELEVANT COMMITTEE
30 August 2019
Additional information is available on
www.fitchratings.com

Latest Press Release

Fitch Affirms Ratings of Krung Thai Bank and its Securities Subsidiary

Environment", dated 2 April 2020 at https://www.fitchratings.com/research/banks/coronavirus-increases-challenges-for-thai-banks-operating-environment-02-04-2020. The duration and trajectory of the pandemic remains uncertain. As such, Fitch expects that...

Fitch Downgrades Siam Commercial Bank to 'BBB' on Coronavirus Outbreak

https://www.fitchratings.com/research/banks/coronavirus-increases-challenges-for-thai-banks-operating-environment-02-04-2020. The duration and trajectory of the coronavirus outbreak remains uncertain. As such Fitch expects that in a base case scenario,...

Fitch Downgrades KASIKORNBANK to 'BBB' on Coronavirus Outbreak

https://www.fitchratings.com/research/banks/coronavirus-increases-challenges-for-thai-banks-operating-environment-02-04-2020. Fitch's base-case scenario sees KBank's asset quality and performance being significantly affected over the next two years,...

Businesses Focus on Containing Costs and Protecting Employees, According to PwC COVID-19 CFO Pulse Survey

The second release of the PwC COVID-19 CFO Pulse Survey reveals growing concerns around the business and economic impact of the coronavirus pandemic among chief financial officers (CFOs) and finance executives. Based on responses collected from 55...

Fitch Downgrades Bangkok Bank to 'BBB' on Coronavirus Outbreak

https://www.fitchratings.com/research/banks/coronavirus-increases-challenges-for-thai-banks-operating-environment-02-04-2020. The duration and trajectory of the coronavirus outbreak remains uncertain. As such, Fitch expects BBL's asset quality and...

Related Topics