/raid1/www/Hosts/bankrupt/TCRAP_Public/230209.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Thursday, February 9, 2023, Vol. 26, No. 30
Headlines
A U S T R A L I A
ACCORD SECURITY: First Creditors' Meeting Set for Feb. 16
BARAJA PTY: Driverless Car Start-Up Sacks 75% of Staff
BLUEWATERS POWER: System Operator Predicts Plant to Close by 2029
E CONNECT: Worrells Appointed as Administrator
HAND PICKED: Founder Used Festival Funds to Prop Up Businesses
MICROHIRE PTY: G S Andrews Appointed as Administrator
PEPPER RESIDENTIAL NO. 35: S&P Puts Prelim 'B+' Rating on F Notes
RESIMAC BASTILLE NO. 2: S&P Affirms BB(sf) Rating on Class E Notes
SAINT LUKE: First Creditors' Meeting Set for Feb. 16
B A N G L A D E S H
SOCIAL ISLAMI: Moody's Downgrades Deposit & Issuer Ratings to Caa1
C H I N A
WANDA PROPERTIES: Moody's Rates New Senior Unsecured Bond 'Ba3'
I N D I A
AKASH AGRO: CARE Keeps C Debt Rating in Not Cooperating Category
BAJLA MOTORS: CARE Keeps C Debt Rating in Not Cooperating
EDAYAR ZINC: CARE Keeps D Debt Ratings in Not Cooperating
FUTURE RETAIL: NCLT Asks Auditors to Reply to RP's Plea
GANGADHAR JENA: CRISIL Lowers Long/Short Term Loan Rating to D
HARSO STEELS: CARE Keeps D Debt Ratings in Not Cooperating
KAMLA RICE: CARE Keeps D Debt Rating in Not Cooperating Category
KERALA STATE: CARE Assigns D Rating to INR50cr LT Loan
KRISHNA EDUCATIONAL: CRISIL Cuts Long/Short Term Loan Rating to D
NARAYANI STEELS: CARE Keeps D Debt Ratings in Not Cooperating
PRITS LEATHER: CRISIL Keeps D Debt Rating in Not Cooperating
RADHE COTTON: CRISIL Keeps D Debt Ratings in Not Cooperating
RAJESH PROJECTS: CARE Keeps D Debt Ratings in Not Cooperating
RELIANCE CAPITAL: NCLAT Issues Notices to Torrent Investments
SAPTAGIR LABORATORIES: CARE Keeps C Debt Rating in Not Cooperating
SINGH EDUCATION: CARE Keeps C Debt Rating in Not Cooperating
SUNPAUL PROPERTIES: CARE Keeps C Debt Rating in Not Cooperating
V. A. PRODUCTS: CARE Keeps C Debt Rating in Not Cooperating
VISHAL CONDUIT: CARE Keeps C/A4 Debt Rating in Not Cooperating
VUDDANDA SOLAR: CARE Keeps D Debt Rating in Not Cooperating
I N D O N E S I A
GARUDA INDONESIA: Two Lessors Seek to Cancel Restructuring Deal
LIPPO KARAWACI: Moody's Confirms B3 CFR, Alters Outlook to Stable
N E W Z E A L A N D
AMRITA NAICKERS: Commences Wind-Up Proceedings
BANZPAY TECHNOLOGY: Fitch Affirms BB- LongTerm IDR, Outlook Now Neg
CHRISTIAN SAVINGS: Fitch Affirms BB+ LongTerm IDRs, Outlook Stable
CONSTRUCTION 41: Commences Wind-Up Proceedings
CULLEN INVESTMENTS: Liquidators Chase Eric Watson for Debt Payment
FIRST CREDIT: Fitch Affirms LongTerm IDRs at 'BB', Outlook Stable
JOHNSON CORNER: Creditors' Proofs of Debt Due on Feb. 19
LOG AND ROAD: Creditors' Proofs of Debt Due on March 10
NELSON BUILDING: Fitch Alters Outlook on 'BB+' LongTerm IDRs to Pos
TALLENTYRE TRUSTEE: Court to Hear Wind-Up Petition on Feb. 24
UNITY CREDIT: Fitch Alters Outlook on 'BB' LongTerm IDRs to Neg.
WAIRARAPA BUILDING: Fitch Affirms BB+ LongTerm IDRs, Outlook Stable
WELLY BUILDS: Creditors' Proofs of Debt Due on March 15
S I N G A P O R E
3D METALFORGE: Commences Wind-Up Proceedings
MIDAS NSSG: Commences Wind-Up Proceedings
PAN POLY: Members' Final Meeting Set for March 16
S&E OFFSHORE: Creditors' Proofs of Debt Due on March 10
TRABBLE PTE: Commences Wind-Up Proceedings
[*] SINGAPORE: More Properties Up for Auction as Bankruptcy Rise
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A U S T R A L I A
=================
ACCORD SECURITY: First Creditors' Meeting Set for Feb. 16
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Accord
Security Pty Ltd will be held on Feb. 16, 2023, at 11:30 a.m. at
Hotel Clipper, 20-30 Patterson Road, in Rockingham, WA. The meeting
will be simultaneously held via Zoom virtual meeting technology.
Cameron Shaw and Richard Albarran of Hall Chadwick were appointed
as administrators of the company on Feb. 6, 2023.
BARAJA PTY: Driverless Car Start-Up Sacks 75% of Staff
------------------------------------------------------
News.com.au reports that an Australian self-driving technology
start-up that was valued at AUD300 million has slashed around 75%
of its workforce, despite a recent cash injection in January.
Staff have been devastated by the cuts - with entire teams laid off
and others losing their job after joining mere months ago - as a
result of the "drastic" downsizing, news.com.au says.
News.com.au relates that the company, called Baraja, which boasts
backing from CSIRO venture capital fund Main Sequence Ventures,
made the mass redundancies due to concerns that funding was
becoming harder to attract globally and there was a slower take-up
of the driverless technology.
Baraja was started eight years ago and was valued at AUD300 million
in its last funding round in 2021.
It would not confirm the scale of sackings but employees shared on
LinkedIn that the downsizing was "drastic", while sources also told
The Australian Financial Review that three-quarters of employees
were impacted, news.com.au relays.
Employees revealed it had been a "difficult week" at Baraja after
the "devastating" announcement of the "big shake-up", with news it
was "drastically downsizing" - impacting roles including technical
staff, engineers, software experts, product managers and
accounting.
According to the report, Baraja's co-founder and chief executive
Federico Collarte told the AFR that major staffing cuts had been
unavoidable but the company did not take the redundancy "decision
lightly".
He added customers had slowed down the development of new vehicles
amid a toughening financial outlook while manufacturing delays also
added difficulties.
Staff had been cut from working on existing projects with a
restructuring of its engineering teams in Australia and the United
States, he noted.
The driverless technology company is the latest start-up to be
caught up in the tech wreck that is smashing the sector, the report
notes.
BLUEWATERS POWER: System Operator Predicts Plant to Close by 2029
-----------------------------------------------------------------
ABC News reports that Western Australia's only privately owned
coal-fired power station will close before the end of the decade,
according to plans that would bring the curtain down on the fuel's
use in the state's economy.
Bluewaters power station is Australia's newest coal-fired generator
but the Australia Energy Market Operator has suggested the 440MW
plant near Collie, 180km south of Perth, will retire by 2029, ABC
says.
According to the report, the shock suggestion follows last year's
announcement by the WA government that it will close the two
remaining state-owned coal plants at the same time.
It also comes amid assurances by the government that a
taxpayer-funded bailout of the broke coal mine supplying Bluewaters
would not be used to repay the debts owed to foreign lenders.
In its latest assessment of WA's domestic gas needs for the next 10
years, AEMO forecast a major bump in demand for gas-fired power
generation from 2030 as coal retirements took effect.
The market operator noted that under the Government's plans,
state-owned power utility Synergy would shutter the 340MW Collie A
coal plant in 2027 followed by the bigger Muja plant in 2029.
However, AEMO said it had also "assumed that Bluewaters power
station retires at the same time as the Muja units".
What's more, the agency reckoned miner South32 would replace coal
with gas as part of the industrial process at its Worsley Alumina
refinery near Collie.
Built by fallen WA magnate Ric Stowe, Bluewaters began operating in
2009 but has been wracked with problems ever since.
Key among those has been the relationship with its coal supplier,
the trouble-plagued Griffin mine owned by a group of Indian banks,
the report relates.
ABC says Griffin was last year tipped into receivership under the
weight of mounting losses and debts adding up to $1.44 billion,
almost all of which was owed to secured creditors.
By far the largest among those was India's largest private bank
ICICI, which is believed to be owed about $1.1 billion.
The descent of Griffin into receivership helped precipitate a
crisis in WA's domestic coal industry, which is still responsible
for providing about a third of the power in the state's biggest
electricity system.
Bluewaters power station is notionally owned by Japanese trading
houses Sumitomo and Kansai Electric, which paid $1.2 billion for
the asset in 2010 when Mr. Stowe's business empire collapsed.
However, in 2020 Sumitomo and Kansai wrote down the value of their
investment in Bluewaters to zero as Griffin's woes and rising
competition from renewable energy took a toll.
Since then, the power plant has effectively been controlled by a
group of US hedge funds including giants Oaktree Capital and
Elliott Management.
E CONNECT: Worrells Appointed as Administrator
----------------------------------------------
Aaron Kevin Lucan of Worrells on Feb. 8, 2023, was appointed as
administrator of E Connect Solar & Electrical Pty Ltd, trading as
Econnect Country.
The administrator may be reached at:
Aaron Kevin Lucan
Worrells
Suite 804, Level 8
33 Argyle Street
Parramatta, NSW 2150
HAND PICKED: Founder Used Festival Funds to Prop Up Businesses
--------------------------------------------------------------
MusicFeeds reports that the Grass Is Greener festival's parent
company Hand Picked Events and Marketing - founded by Oliver
Fines-Frost - reportedly owed AUD2.5 million dollars to various
creditors when it went into administration, according to the Gold
Coast Bulletin.
The Grass Is Greener festival officially went into administration
in the final days of 2022, following a disastrous year in which
numerous artists pulled out at the last minute and organisers
cancelled two legs of the festival.
A new article in the Bulletin has outlined how Mr. Fines-Frost
allegedly used festival funds to prop up his other businesses,
including an F45 gym and multiple restaurants, MusicFeeds relays.
The Bulletin also revealed that The Grass is Greener's biggest
creditor was YouTuber David Nicholas - aka The Captain Davo - who
reportedly pitched in AUD1.25 million.
According to the Bulletin, that more than AUD760,000 of festival
money was allegedly used to support other businesses in Mr.
Fines-Frost's portfolio. They include the restaurants Maman (which
he owns with Ironman Matt Poole), Naami, Luciana Tapas, and Milky
Lane in Surfers Paradise, all of which Mr. Fines-Frost and festival
co-founder Jonathan Eddings have interests in.
Another business that reportedly received an interest-free loan
from the festival was an F45 gym in Lismore, which Mr. Fines-Frost
shares with Tenzin Stark - a DJ who played The Grass Is Greener on
multiple occasions, MusicFeed notes. The gym reportedly owes
AUD53,000 to the company behind Grass Is Greener; it trades via a
company called Dynamite Holdings - Mr. Eddings is also a
shareholder.
MusicFeeds adds that the most intriguing revelation is the fact
that YouTuber David Nicholas - who shot to fame with various
gambling videos and is now a self-styled venture capitalist - is
the largest creditor. The Bulletin reported that Mr. Nicholas'
company, DN Holdings, loaned Hand Picked Events and Marketing
AUD1.25 million just before it went into administration.
Under the deed of company arrangement that creditors recently voted
on, the loans will never have to be repaid. Interestingly, the
Grass Is Greener festival may not be dead: SearchParty app founders
Jade and Jessy Mulholland created a new company (involving
shareholders of DN Holdings) with an interest in purchasing the IP
of the event, the report says.
MusicFeeds relates that the wheels began to fall off just a month
before The Grass Is Greener was scheduled to kick off in October,
when Sydney drill band ONEFOUR announced they'd no longer be
playing the festival because organisers had "failed to honour their
obligations". Just two days later, organisers cancelled the
Canberra and Geelong legs of the festival.
"The reason for cancellation doesn't rest upon a single factor,"
organisers said in a statement at the time. "Rather, it's related
to the culmination of multiple elements that have affected not only
us but our industry partners and siblings across the entire event
industry in the COVID/post-lockdown period."
Numerous other artists pulled out, including headliners Ty Dolla
$ign, ZHU, and Maya Jane Coles, and a slew of other small lineup
changes were made in the week before the festival.
MICROHIRE PTY: G S Andrews Appointed as Administrator
-----------------------------------------------------
Andrew Juzva of G S Andrews Advisory on Feb. 7, 2023, was appointed
as administrator of Microhire Pty. Ltd.
The administrator may be reached at:
Andrew Juzva
G S Andrews Advisory
22 Drummond Street
Carlton, VIC 3053
PEPPER RESIDENTIAL NO. 35: S&P Puts Prelim 'B+' Rating on F Notes
-----------------------------------------------------------------
S&P Global Ratings assigned its preliminary ratings to eight
classes of nonconforming and prime residential mortgage-backed
securities (RMBS) to be issued by Permanent Custodians Ltd. as
trustee of Pepper Residential Securities Trust No.35. Pepper
Residential Securities Trust No.35 is a securitization of
nonconforming and prime residential mortgages originated by Pepper
Homeloans Pty Ltd.
The preliminary ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including its view that the credit support is sufficient
to withstand the stresses it applies. The credit support for the
rated notes comprises note subordination and excess spread. The
assessment of credit risk takes into account the underwriting
standard and centralized approval process of the seller, Pepper
Homeloans.
-- The availability of a retention amount and amortization amount,
which will all be funded by excess spread, but at various stages of
the transaction's term. They will have separate functions and
timeframes, including reducing the balance of notes outstanding.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including a liquidity facility
equal to 1.5% of the outstanding balance of the notes, principal
draws, and a yield-enhancement reserve--to the extent it is
funded--are sufficient under its stress assumptions to ensure
timely payment of interest.
-- That S&P also has factored into its ratings the legal structure
of the trust, which has been established as a special-purpose
entity and meets its criteria for insolvency remoteness.
Preliminary Ratings Assigned
Pepper Residential Securities Trust No.35
Class A1-s, A$100.0 million: AAA (sf)
Class A1-a, A$275.0 million: AAA (sf)
Class A2, A$50.0 million: AAA (sf)
Class B, A$46.0 million: AA (sf)
Class C, A$10.5 million: A (sf)
Class D, A$4.5 million: BBB (sf)
Class E, A$3.0 million: BB (sf)
Class F, A$3.0 million: B+ (sf)
Class G, A$8.0 million: Not rated
RESIMAC BASTILLE NO. 2: S&P Affirms BB(sf) Rating on Class E Notes
------------------------------------------------------------------
S&P Global Ratings affirmed its ratings on five classes of notes
issued by Perpetual Trustee Co. Ltd. as trustee for RESIMAC
Bastille Trust - Warehouse Series No.2.
The rating affirmations follow a review of the transaction due to
an increase in the size of the collateral pool following the
purchase of loans by the warehouse facility, funded by note
issuance. During the transaction's 12-month revolving period, the
acquisition of assets by the trust can be funded by additional note
issuance. S&P assesses the minimum levels of credit support,
liquidity, and yield that are commensurate with its ratings on the
notes before any such sales into the trust. This is because the
credit support and liquidity requirement can change, depending on
the characteristics of the portfolio.
The rating affirmations reflect:
-- The credit risk of the underlying collateral portfolio, which
is currently A$564.0 million. The weighted-average loan-to-value
ratio of the loans now in the portfolio is 71.0% and the
weighted-average seasoning is 8.1 months.
-- That the proportion of loans in the portfolio to borrowers
whose income has not been fully verified has decreased to 97.6%
from 97.9% in December 2022. While these borrowers have not
provided definitive proof of their income, RESIMAC Ltd. has carried
out a range of checks to determine the reasonableness of their
declared incomes. S&P Global Ratings has adjusted the minimum
credit support for partially verified loans to reflect the lower
standard of debt-servicing assessment on these loans.
-- That loans comprising 88.2% of the pool are to self-employed
borrowers, down from 89.9% previously. Where RESIMAC has been
unable to provide employment data, S&P has assessed a portion as
being self-employed. S&P Global Ratings expects self-employed
borrowers to experience higher cash-flow variability and,
consequently, higher loan arrears, making them more susceptible to
defaults should there be a downturn in the Australian economy. S&P
assumes higher default frequencies for these loans.
-- That loans representing 0.12% of the portfolio are insured by a
primary lenders' mortgage insurance (LMI) policy provided by a
rated mortgage insurer. The LMI policies cover the outstanding
mortgage loan principal, accrued interest, and any reasonable
enforcement expenses on the defaulted mortgage loans.
-- That the credit support provided to each class of notes is
commensurate with the ratings assigned and the rated notes can meet
timely payment of interest and ultimate payment of principal under
the rating stresses. Key rating factors are the level of
subordination provided, the size of the liquidity facility, the
principal draw function, and the provision of an extraordinary
expense reserve.
Ratings Affirmed
RESIMAC Bastille Trust - Warehouse Series No.2
Class A: AAA (sf)
Class B: AA (sf)
Class C: A (sf)
Class D: BBB (sf)
Class E: BB (sf)
SAINT LUKE: First Creditors' Meeting Set for Feb. 16
----------------------------------------------------
A first meeting of the creditors in the proceedings of Saint Luke
Holdings Pty. Ltd. will be held on Feb. 16, 2023, at 10:00 a.m. via
virtual facilities.
Stewart Free and Bradd William Morelli of Jirsch Sutherland were
appointed as administrators of the company on Feb. 6, 2023.
===================
B A N G L A D E S H
===================
SOCIAL ISLAMI: Moody's Downgrades Deposit & Issuer Ratings to Caa1
------------------------------------------------------------------
Moody's Investors Service has downgraded Social Islami Bank
Limited's (SIBL) long-term (LT) foreign (FC) and local (LC)
currency bank deposit ratings to Caa1 from B3, and its Baseline
Credit Assessment (BCA) and adjusted BCA to caa2 from caa1.
Moody's has also downgraded SIBL's LT FC and LC counterparty risk
ratings (CRR) to B3 from B2, its LT Counterparty Risk Assessment
(CRA) to B3(cr) from B2(cr), and its LT FC and LC issuer rating to
Caa1 from B3.
In addition, Moody's has affirmed the bank's Not Prime (NP)
short-term (ST) foreign and domestic CRR, ST FC and LC bank deposit
ratings, ST FC and LC issuer rating and NP(cr) ST CRA.
Moody's has also revised SIBL's outlook on the LT bank deposit
ratings and LT issuer rating to negative from stable.
RATINGS RATIONALE
The downgrade of SIBL's ratings and BCA reflects Moody's
expectation that risks to the bank's credit profile have materially
increased due to its weakening funding and liquidity and growing
asset risk, which are exacerbated by corporate governance
concerns.
On January 31, 2022, SIBL's Chairman and an Additional Managing
Director resigned. The resignations followed months of negative
news around potential asset quality issues in some of the bank's
large borrowers as well as its funding and liquidity. Moody's
expects the developments will hurt the bank's liquidity and
constrain its access to new funding. The agency also notes that
some of the bank's liquid assets are encumbered at the central bank
and will not be available immediately in times of stress.
The negative outlook reflects Moody's expectation that SIBL's
funding and liquidity can come under further strain over the next
12-18 months due to heightened risks to its solvency.
In this rating action, Moody's has made a negative adjustment for
corporate behavior in SIBL's BCA, which results in a one-notch
downward adjustment to the caa2 BCA from the financial profile of
caa1.
Moody's has also revised SIBL's ESG Credit Impact Score to CIS-5
(very highly negative) from CIS-4 (highly negative), and its
Governance Issuer Profile Score to G-5 from G-4. The change in ESG
scores reflects the very significant impact of governance risk on
the bank's current rating. Moody's regards SIBL's corporate
governance weakness, as reflected by its growing vulnerability to
funding shocks and limited liquidity buffers, as a governance risk
under its ESG framework.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
WHAT COULD MOVE THE RATINGS UP
Given the negative outlook, an upgrade of SIBL's ratings in the
near term is unlikely. However, Moody's could revise the outlook to
stable if the bank maintains its funding and liquidity while its
solvency remains stable over the next 12-18 months.
WHAT COULD MOVE THE RATINGS DOWN
Moody's could downgrade SIBL's BCA and long-term ratings if the
bank's funding and liquidity deteriorate. A spike in its NPL ratio,
leading to a deterioration in capital and profitability, will also
be negative for the ratings.
The principal methodology used in these ratings was Banks
Methodology published in July 2021.
Social Islami Bank Limited is headquartered in Dhaka and reported
total assets of BDT431 billion as of September 30, 2022.
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C H I N A
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WANDA PROPERTIES: Moody's Rates New Senior Unsecured Bond 'Ba3'
---------------------------------------------------------------
Moody's Investors Service has assigned a Ba3 rating to the senior
unsecured bond issued by Wanda Properties Global Co. Limited.
Wanda Properties Global Co. Limited is a wholly-owned subsidiary of
Wanda Commercial Properties (HK) Co. Limited (Wanda HK). The bond
is guaranteed by Wanda HK and supported by deeds of equity interest
purchase undertakings and keepwell deeds between Dalian Wanda
Commercial Management Group Co., Ltd. (DWCM), Wanda HK and the bond
trustee.
The outlooks on the companies are stable.
"The proposed bond will lengthen DWCM's and Wanda HK's debt
maturity profile and will not have a material impact on their
credit profile, since Moody's expect the proceeds to be used to
prefund its maturing debt," says Alfred Hui, a Moody's Analyst.
RATINGS RATIONALE
DWCM's Ba1 corporate family rating (CFR) reflects the company's
strong brand and track record of developing and operating
commercial properties in China. The rating also considers the
company's adequate liquidity and sizable recurring lease and
management fee income from its investment property portfolio, which
provides the company with stable and recurring cash flow. The
company's credit metrics also support its Ba1 CFR.
On the other hand, DWCM's Ba1 CFR is constrained by its exposure to
lower-tier cities and execution risks related to its expansion plan
amid fast-changing business conditions, as well as its private
company status. Nevertheless, risks related to its corporate
governance is partly tempered by the presence of an investment
consortium including Tencent Holdings Limited (A1 stable) and other
investors, which appoint representatives to DWCM's board of
directors to balance the interests of shareholders, creditors and
other stakeholders.
Moody's expects DWCM's operations will gradually recover in 2023,
as the occupancy rate of its retail malls improve with the
relaxation of China's COVID policies.
Accordingly, the company's adjusted net debt/EBITDA, will improve
to 4.1x from an estimated level of 4.7x in 2022, while its EBITDA
interest coverage will improve to 3.3x from 2.8x over the same
period. These projected ratios continue to support DWCM's CFR at
the Ba1 level.
Moody's expects DWCM's offshore funding costs will likely increase
given currently high interest rates. However, the agency believes
this will not materially impact the company's interest-servicing
capability, considering its small exposure to offshore funding,
which accounted for only an estimated 6% of its reported debt as of
the end of September 2022.
DWCM's liquidity is adequate, underpinned by its large cash
holdings of RMB34.8 billion, short-term investments of RMB46.8
billion as of September 30, 2022, and sizable and stable rental and
management fee income. Moody's expects these cash resources to be
sufficient to cover DWCM's maturing debt, committed capital
expenditure for its portfolio of shopping malls, and potential
repurchase obligation of the pre-IPO capital of its commercial
property management arm over the next 12-18 months.
Wanda HK's Ba3 CFR incorporates the company's standalone credit
profile plus a two-notch uplift based on Moody's expectation that
the company will receive support from its parent, DWCM, when
needed.
Moody's support assumption considers DWCM's 100% ownership of Wanda
HK, the parent's full control of the company, and Wanda HK's role
as DWCM's primary platform for offshore funding and investment.
Moody's expects DWCM to maintain its ability to provide support to
Wanda HK when needed, as reflected by its Ba1 CFR and track record
of providing timely funding support.
Wanda HK's standalone credit profile is constrained by its small
operating scale, exposure to the seasonality and volatile operating
conditions of its hotel business, weak credit metrics and thin
equity base. These weaknesses are partially offset by the company's
adequate liquidity and the parent's close control of the company.
Wanda HK's liquidity is weak, with sizable offshore bonds coming
due over the next 12-18 months, including a USD400 million bond due
in July 2023 and a USD600 million bond due in January 2024. The
company issued a USD400 million offshore bond in January 2023,
which partly tempers the refinancing risk. Moody's expects DWCM
will also provide funding support to Wanda HK when needed.
In terms of environmental, social and governance (ESG) factors,
Moody's has considered DWCM's private company status with
concentrated ownership by its ultimate shareholder, Mr. Wang
Jianlin, who directly and indirectly owned a 53% equity stake in
DWCM as of the end of 2021. Moody's has also considered DWCM's
prudent financial strategy to control debt-funding needs when
pursuing its business aspirations.
Moody's has also taken into account Wanda HK's private company
status and low corporate transparency. However, DWCM's 100%
ownership of the company and history of providing support to its
subsidiary mitigate these risks.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The stable rating outlook on DWCM reflects Moody's expectation that
the company will maintain solid financial metrics to support its
Ba1 CFR, and have sufficient cash resources to cover its operating
and refinancing needs over the next 12-18 months.
The stable rating outlook on Wanda HK primarily reflects Moody's
expectation that DWCM will continue to provide financial support to
the company in times of stress, given the close linkage between the
two companies.
Moody's could upgrade DWCM's Ba1 CFR if the company strengthens its
corporate governance and disclosure standards like other publicly
listed companies; achieves its business growth plan; and improves
its financial metrics, with its adjusted net debt/EBITDA falling
below 4.0x-4.5x and EBITDA/interest coverage increasing above
3.0x-3.5x on a sustained basis.
On the other hand, Moody's could downgrade DWCM's Ba1 CFR if the
company's liquidity weakens; growth in its leasing and management
income is slower than expected; or its credit metrics deteriorate.
Credit metrics indicative of negative rating pressure include
adjusted net debt/EBITDA rising above 6.0x-6.5x and EBITDA/interest
coverage falling below 2.0x on a sustained basis.
Additionally, any significant leakage of funds from DWCM or a
substantial deterioration in the company's corporate governance and
transparency could strain its rating.
Upward pressure on Wanda HK's CFR could develop if Wanda HK's
standalone credit profile strengthens, DWCM's CFR is upgraded and
Wanda HK's strategic and economic importance to the parent
increases.
On the other hand, a downgrade of DWCM's CFR will result in a
downgrade of Wanda HK's CFR and the ratings on its guaranteed
bonds.
Furthermore, Wanda HK's rating could face downward pressure if the
company's standalone credit profile deteriorates; DWCM reduces its
ownership in the company; or its strategic and economic importance
to DWCM declines.
The principal methodology used in this rating was Business and
Consumer Services published in November 2021.
Dalian Wanda Commercial Management Group Co., Ltd. (DWCM) develops
and operates commercial properties in China. As of the end of 2021,
it operated 417 retail malls in 214 Chinese cities.
As of December 31, 2021, the company was 44.31% owned by Dalian
Wanda Group Co., Ltd. (Dalian Wanda Group), whose chairman, Wang
Jianlin, also directly and indirectly owned a 53.25% stake in DWCM.
Additionally, an investment consortium, led by Tencent Holdings
Limited (A1 stable) and comprising JD.com, Inc. (Baa1 stable),
Sunac China Holdings Limited and Suning Commerce Group Co., Ltd.
(Suning), owned a 14.2% stake in the company.
Wanda Commercial Properties (HK) Co. Limited (Ba3 stable) is DWCM's
primary offshore funding and investment platform. The company's
main assets include a 65.04% equity interest in Hong Kong-listed
Wanda Hotel Development Company Limited.
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I N D I A
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AKASH AGRO: CARE Keeps C Debt Rating in Not Cooperating Category
----------------------------------------------------------------
CARE Ratings said the ratings for the bank facilities of Akash Agro
Industries (AAI) continue to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 9.00 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Short Term Bank 10.00 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated January 28,
2022, placed the rating(s) of AAI under the ‘issuer
non-cooperating’ category as AAI had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement. AAI continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated December 14, 2022, December
24, 2022, January 3, 2023.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.’s opinion is not sufficient
to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
AAI was incorporated in August-2017 by Mrs. Laxmi Devi and Mr.
Mangat Raj. The firm has set up a cotton ginning and pressing
facility in Sirsa, Haryana which commenced operations in January-
2018. The firm is also engaged in the selling of cotton seeds
(Binola), which is a by-product of the ginning process and derived
~30% of the total from this segment in FY18. Group concerns of the
firm include Shiva Trading Firm (STC) engaged in the edible oil
extraction business.
BAJLA MOTORS: CARE Keeps C Debt Rating in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Bajla
Motors Private Limited (BMPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 11.75 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 2,
2021, placed the rating(s) of BMPL under the ‘issuer
non-cooperating’ category as BMPL had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement. BMPL continues to be noncooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated September 18, 2022, September
28, 2022, October 8, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.’s opinion is not sufficient
to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Bajla Motors Pvt. Ltd. (BMPL) was incorporated in August, 2000 by
Bajla Family of Siliguri, West Bengal and started its commercial
operation from January, 2001. The company is an authorized dealer
of Tata Motors Ltd (TML) for its passenger cars, spares &
accessories for three districts of West Bengal. At present, BMPL
offers vehicles of TML & PVPL through its four showrooms (two in
Siliguri , one in Darjeeling and one in Cooch Behar districts of
West Bengal) equipped with 3-S facilities (Sales, Service and
Spare-parts). Apart from this, the company also purchases and sells
pre-owned cars.
EDAYAR ZINC: CARE Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------
CARE Ratings said the ratings for the bank facilities of Edayar
Zinc Limited (EZL) continue to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 15.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 247.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 12,
2021, placed the rating(s) of EZL under the ‘issuer
non-cooperating’ category as EZL had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement. EZL continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated September 28, 2022, October 8,
2022, October 18, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Edayar Zinc Limited (EZL), a subsidiary of Binani Industries
Limited (BIL), has been in operations since 1967. The company is
engaged in the manufacture of zinc at its plant located at
Binanipuram in Kerala. The company also produces sulphuric acid and
cadmium which are generated as by-products.
FUTURE RETAIL: NCLT Asks Auditors to Reply to RP's Plea
-------------------------------------------------------
Livemint.com reports that the National Company Law Tribunal (NCLT)
on Feb. 6 asked statutory auditors of Future Retail Ltd to respond
after the bankrupt company's resolution professional (RP) accused
them of non-cooperation.
According to the report, the counsel for RP had filed an
application under Section 19(2) of the Insolvency and Bankruptcy
Code which allows the RP to file an application before the
adjudicating authority for necessary directions if a promoter or
any other person required to assist or co-operate with the interim
resolution professional does not do so.
Essentially, the RP has sought the court's intervention in seeking
relevant documents from Future Group's erstwhile promoters and
auditors.
A bench of justices Shyam Babu Gautam and P.N. Deshmukh asked the
auditor to file a reply in two weeks and posted the matter for
further hearing on February 21, Livemint.com relates.
Counsel for the auditors of Future group, while seeking time to
file a reply, said, "Under the petition for non-cooperation that
has been filed, a lot of documents that have been asked for, I
(auditor) am not even required to keep. I am the ex-auditor for the
corporate debtor."
He added that the documents that are being sought include sample
agreements with vendors and landlords. "How as an auditor should I
have all of these documents? I will address this and file a
detailed reply and clarify my position on the documents that I have
as an auditor," the counsel said, Livemint.com relays.
Livemint.com says the bench told the auditor that the position of
the RP needs to be understood. "Since you were running the company,
you will have a better idea about it".
The bench has also asked the RP to state on record the inventory
held by the insolvent firm. Previously, the RP had informed the
bench that the promoters were not co-operating with him and not
providing necessary information with respect to the assets of the
company.
About Future Group
Future Group operates multi-branded retail outlets. The company's
retail chains include department stores, outlet stores, sportswear,
home improvement and consumer durables, supermarket, and
convenience stores as well as food parks.
As reported in the Troubled Company Reporter-Asia Pacific in late
July 2022, an Indian court agreed to send Future Retail Ltd. into
bankruptcy, allowing the creditors to find a new owner for the
beleaguered retailer. According to Bloomberg News, the National
Company Law Tribunal on July 20 gave its verdict on a petition by
Bank of India to start the bankruptcy-resolution process for the
cash-strapped retailer. It dismissed allegations from the local
unit of Amazon.com Inc. that Future Retail's lenders were colluding
with its founders to push the firm into insolvency. The court also
appointed an administrator to take over the management at Future
Retail.
GANGADHAR JENA: CRISIL Lowers Long/Short Term Loan Rating to D
--------------------------------------------------------------
CRISIL Ratings has revised the ratings on certain bank facilities
of Gangadhar Jena (GJ), as:
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Rating - CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Short Term Rating - CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL A4 ISSUER NOT
COOPERATING')
CRISIL Ratings has been consistently following up GJ for obtaining
information through email dated April 20, 2022, June 8, 2022 and
January 27, 2023, apart from telephonic communication. However, the
issuer has remained non-cooperative.
The investors, lenders and all other market participants should
exercise due caution with reference to the ratings
assigned/reviewed with the suffix 'Issuer Not Cooperating' as the
ratings are arrived at without any management interaction and are
based on best-available or limited or dated information on the
company. Such non-cooperation by a rated entity may be a result of
deterioration in its credit risk profile. These ratings with
'issuer not cooperating' suffix lack a forward-looking component.
Detailed Rationale
Despite repeated attempts to engage with the management of GJ,
CRISIL Ratings has not obtained any information on either the
financial performance or strategic intent of the company. This
restricts the ability of CRISIL Ratings to take a forward-looking
view on the entity's credit quality. Therefore, on account of
inadequate information, lack of management cooperation and
unfavourable information in the public domain, CRISIL Ratings has
downgraded its ratings on the bank facilities of SMIPL to 'CRISIL
D/CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable/CRISIL A4
Issuer Not Cooperating'. CRISIL Ratings believes the rating action
is consistent with the criteria detailed in 'Assessing information
adequacy risk'.
The downgrade reflects instances of continuous overdrawals in the
cash credit account of GJ for more than 30 days in the month of
December, 2022.
GJ, a sole proprietorship firm of Mr. Gangadhar Jena, constructs
and maintains roads, buildings, and bridges for government
departments and public sector entities. It is a registered Super
Class Contractor with the Public Works Department, Odisha.
HARSO STEELS: CARE Keeps D Debt Ratings in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Harso
Steels Private Limited (HSPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 14.82 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 11.18 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 22,
2021, placed the rating(s) of HSPL under the 'issuer
non-cooperating' category as HSPL had failed to provide information
for monitoring of the rating and had not paid the surveillance fees
for the rating exercise as agreed to in its Rating Agreement. HSPL
continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated October 8, 2022, October 18, 2022, October 28,
2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Harso Steels Private Limited (HSPL) was incorporated in 1986 and
started its commercial operation in 1993. The company is currently
being managed by Mr. Rakesh Kumar Bansal, Mr. Vikas Bansal and Mr.
Adesh Tyagi. The company is engaged in manufacturing of steel
tubes. PVC pipes, steel structure and bottom lid. The main raw
material is steel which the company procures solely from Steel
Authority of India Limited (SAIL). HSPL sells its products
domestically to wholesalers and construction companies. The company
has an associate concern named Rama Steel Tubes Limited which is
engaged in manufacturing and exporting of steel pipes, steel tubes,
steel pipes fittings, steel tubes fittings, PVC pipes, PVC tubes,
steel pipes etc.
KAMLA RICE: CARE Keeps D Debt Rating in Not Cooperating Category
----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Kamla Rice
and General Mills (KRGM) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 12.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Rationale and key rating drivers
CARE Ratings Ltd. had, vide its press release dated January 12,
2022, placed the rating(s) of KRGM under the 'issuer
non-cooperating' category as KRGM had failed to provide information
for monitoring of the rating and had not paid the surveillance fees
for the rating exercise as agreed to in its Rating Agreement. KRGM
continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated November 28, 2022, December 8, 2022, December
18, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Kamla Rice and General Mills (KRGM) was established as a
proprietorship concern in 1994 and it is currently being managed by
Mr. Vipin Goyal. The firm is engaged in processing of paddy at its
manufacturing facility located in Karnal, Haryana.
KERALA STATE: CARE Assigns D Rating to INR50cr LT Loan
------------------------------------------------------
CARE Ratings has assigned rating to the bank facilities of Kerala
State Road Transport Corporation (KSRTC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 50.00 CARE D; Assigned
Facilities
Long Term Bank 2,973.86 CARE D; Reaffirmed
Facilities
Rationale and key rating drivers
The rating assigned to the bank facilities of KSRTC factors in the
instances of delays in servicing of debt obligations on time.
Rating sensitivities: Factors likely to lead to rating actions
Positive factors
* Improvement in liquidity profile of the corporation leading to
servicing of debt on time over a sustained period.
* Consistent improvement in collections.
Negative factors
* Not applicable
Analytical approach: Standalone
Key weaknesses
* Instances of delay in servicing debt obligation: KSRTC have been
delaying in servicing its debt obligation to few of its consortium
lenders. Regularization of these dues to the lenders would be key
monitorable from the credit risk point of view.
Liquidity: Poor
The corporation has been consistently generating negative cash
accruals and is dependent upon Government of Kerala for its
day-to-day operations.
Kerala State Road Transport Corporation (KSRTC) was incorporated on
March 15, 1965 under the Road Transport Corporations Act, 1950
[Central Act 64 of 1950]. It was formed by transferring the assets
and liabilities of the then Kerala State Transport Department vide
Government Notification No.5645/TC4/65/PW dated 10-03-1965. It
started functioning from 01-04-1965 along with the Water Transport
Section, which was operating ferry services around Kochi harbor.
The Water Transport section was separated from the Corporation and
transferred to Water Transport Department from July 1, 1994. In the
past 58 years it had grown into public service provider inevitable
to the Kerala people. It is providing services to rural/tribal
sectors having lesser income routes without commercial motivation
and rendering various service required by Government from time to
time incurring high social cost which however could not be passed
on to public as the rates are fixed by government. The corporation
started with a fleet of 901 buses in 1965 and expanded to fleet
strength of 4300 buses. The distance covered by the transport
corporation is around 13 lakh km/day.
KRISHNA EDUCATIONAL: CRISIL Cuts Long/Short Term Loan Rating to D
-----------------------------------------------------------------
CRISIL Ratings has downgraded its rating on the bank facilities of
Shree Krishna Educational And Charitable Society (REGD) (SKECS) to
'CRISIL D/CRISIL D Issuer Not Cooperating' from 'CRISIL
B/Stable/CRISIL A4 Issuer Not Cooperating' due to delays in
servicing debt obligation.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Rating - CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B/Stable ISSUER NOT
COOPERATING')
Short Term Rating - CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL A4 ISSUER NOT
COOPERATING')
CRISIL Ratings has been consistently following up with SKECS for
obtaining information through letters and emails dated April 29,
2022, May 10, 2022 and May 13, 2022 among others, apart from
telephonic communication. However, the issuer has remained non
cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of SKECS, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that the rating action on
SKECS is consistent with 'Assessing Information Adequacy Risk'.
Based on best-available information, CRISIL Ratings has downgraded
its rating on the bank facilities of SKECS to 'CRISIL D/CRISIL D
Issuer Not Cooperating' from 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating' due to delays in servicing debt obligation.
SKECS was registered as charitable trust in 2008, under income tax
act. It operates two institutes Aryabhatta Engineering and
Management Institute and Aryabhatta Group of College that offer
courses in various disciplines, such as engineering, management,
along with other graduation courses and are located at Punjab. It
is currently managed by Mr. R.K. Gupta, Mr. Vicky Singhal and Mr.
Inderpal Goyal.
NARAYANI STEELS: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the ratings for the bank facilities of Narayani
Steels Limited (NSL) continue to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 97.50 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 125.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale and key rating drivers
CARE Ratings Ltd. had, vide its press release dated January 11,
2022, placed the rating(s) of NSL under the 'issuer
non-cooperating' category as Narayani Steels Limited had failed to
provide information for monitoring of the rating.
Narayani Steels Limited continues to be non-cooperative despite
repeated requests for the submission of information through emails,
phone calls and emails dated between January 13, 2023, to January
20, 2023. In line with the extant SEBI guidelines, CARE Ratings
Ltd. has reviewed the rating on the basis of the best available
information which however, in CARE Ratings Ltd.'s opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
At the time of the last rating on January 11, 2022, the following
were the rating strengths and weaknesses (updated for the
information available from BSE).
Key rating weakness
* Continuing overdues with respect to debt servicing: The lenders
have confirmed continued overdraws and the account has turned NPA
owing to liquidity issues.
Narayani Steels Limited (NSL), which belongs to Narayani Group, is
incorporated in the year 1996 by Mr. Kishanlal Choudhary, who is
the chairman of the company and is ably supported by his son Mr.
Sunil Choudhary, who is the managing director and chief executive
officer with an overall experience of 20 years. During FY17,
Narayani Steels Limited got listed through the SME platform of the
Bombay stock exchange in FY17. NSL is part of the Narayani group;
the group comprises five companies namely
Narayani Steels Limited (NSL), Narayani Ispat Limited (NIL), Hari
Equipment Private Limited (HEPL), Kedarnath Commotrade Private
Limited (KCPL) and Agrimony Tradex Vyaappar Private Limited
(ATVPL). The Narayani group is engaged in the trading of blooms,
billets, TMT bars, pellets, and wire coils and the manufacturing of
TMT bars and other long products such as rounds, flats, angles,
channels, etc. Further, the group has a wide network for the sales
and distribution of the products across Andhra Pradesh, Telangana
and other states in India.
PRITS LEATHER: CRISIL Keeps D Debt Rating in Not Cooperating
------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Prits Leather
Art (P) Ltd. (PLA) continue to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bills Discount/ 8 CRISIL D (Issuer Not
Cheque Purchase Cooperating)
Export Packing 2 CRISIL D (Issuer Not
Credit Cooperating)
CRISIL Ratings has been consistently following up with PLA for
obtaining information through letters and emails dated October 21,
2022 and December 15, 2022 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of PLA, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on PLA
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
PLA continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'.
PLA was incorporated in 2006 as a private limited company. Promoted
by Mr. Ashwani Bhatia and his wife Ms. Seema Bhatia, the company
manufactures and exports leather garments, leather bags, and
accessories. PLA has manufacturing facilities located in Noida,
Uttar Pradesh and derives its revenue primarily through export of
leather garments and bags to European countries.
RADHE COTTON: CRISIL Keeps D Debt Ratings in Not Cooperating
------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Radhe Cotton
(RC) continue to be 'CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.5 CRISIL D (Issuer Not
Cooperating)
Proposed Long Term
Bank Loan Facility 1.09 CRISIL D (Issuer Not
Cooperating)
Term Loan 0.57 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with RC for
obtaining information through letters and emails dated October 21,
2022 and December 15, 2022 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
Ratings failed to receive any information on either the financial
performance or strategic intent of RC, which restricts CRISIL
Ratings' ability to take a forward looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on RC is
consistent with 'Assessing Information Adequacy Risk'. Based on the
last available information, the ratings on bank facilities of RC
continues to be 'CRISIL D Issuer Not Cooperating'.
RC, set up in 2013 at Junagadh, is a partnership between Mr Kirit
Akheniya, Mr Mukesh Limbani, Mr Parakash Kantilal Popat, Mr Uday
Limbani and Mr Viral Akheniya. The firm gins and presses cotton; it
started commercial operations in May 2014.
RAJESH PROJECTS: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Rajesh
Projects (India) Private Limited (RPPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 56.26 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 23.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Rationale and key rating drivers
CARE Ratings Ltd. had, vide its press release dated January 5,
2022, placed the rating(s) of RPPL under the 'issuer
non-cooperating' category as RPPL had failed to provide information
for monitoring of the rating and had not paid the surveillance fees
for the rating exercise as agreed to in its Rating Agreement. RPPL
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated November 21, 2022, December 1, 2022, December
11, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
RPIPL was incorporated in 1999 & is engaged in real estate
business. Historically, the group was mainly into development of
commercial projects in Delhi and has successfully executed 14
commercial/retail projects in Delhi. In 2010, the company ventured
into residential group housing projects in Noida and Greater Noida
region. The group was promoted by Mr. Jai Bhagwan Goyal, a
qualified Civil Engineer, who has more than 40 years' experience in
construction. Currently his son, Mr. Rajesh Goyal who is also MD of
RPIPL, is actively handling the operations of group.
RELIANCE CAPITAL: NCLAT Issues Notices to Torrent Investments
-------------------------------------------------------------
Business Standard reports that the National Company Law Appellate
Tribunal (NCLAT) on Feb. 7 issued notices to Torrent Investments
and other respondents on a petition filed by the lender of Reliance
Capital seeking a second round of financial bids for the
debt-ridden firm, currently going through insolvency resolution
process.
A two-member NCLAT bench headed by Chairperson Justice Ashok
Bhushan issued notices, directing respondents to file replies
within 3 days.
The appellate tribunal has directed to list the petition on
February 10, 2023, saying the appeal would be heard and decided by
it, Business Standard says.
Vistra ITCL (India) Ltd, one of the members of the Committee of
Creditors of Reliance Capital, has moved NCLAT against an NCLT
order.
On February 2, the Mumbai bench of National Company Law Tribunal
(NCLT) had ruled against holding a fresh round of auction for the
takeover of Anil Ambani-promoted Reliance Capital (RCap) and said
the challenge mechanism for financial bids has already concluded,
according to Business Standard.
It upheld the plea by Torrent Investments challenging bankers'
decision to go for the second round of auctions in pursuit of
higher value for the bankrupt company.
Business Standard relates that NCLT in its order said the bench
allows Torrent Investments' application and declared that the
challenge mechanism for financial bids stood concluded as on
December 21, 2022, with the bid of the applicant at INR8,640 crore
being the highest.
Torrent Investments had filed a plea on January 9, requesting the
tribunal to quash the lenders' plan to hold a fresh auction for the
takeover of RCap.
Torrent Investment was the highest bidder offering INR8,640 crore
in the last round of the 'challenge mechanism'.
Reliance Capital has a consolidated debt of about INR40,000 crore,
the report discloses.
About Reliance Capital
Headquartered in Mumbai, India, Reliance Capital Limited --
https://www.reliancecapital.co.in/ -- a non-banking financial
company, primarily engages in lending and investing activities in
India, Singapore, and Mauritius. The company operates through
Finance & Investment, General Insurance, Life Insurance, Commercial
Finance, Home Finance, and Others segments. It offers life, health,
and general insurance products; brokerage and distribution
services, including stock broking, wealth management, and third
party distribution; and commercial and home finance services, such
SME, retail, microfinance, renewable, affordable housing, and home
loans, as well as loans against property and construction finance.
The company also provides asset reconstruction, institutional
broking, and proprietary investments services, as well as other
financial and allied services. The company was formerly known as
Reliance Capital & Finance Trust Limited and changed its name to
Reliance Capital Limited in January 1995.
On Nov. 29, 2021, the Reserve Bank of India superseded Reliance
Capital's board following payment defaults and governance issues,
and appointed Nageswara Rao Y as the administrator for the
bankruptcy process, Financial Express said. The regulator also
filed an application for initiation of Corporate Insolvency
Resolution Process (CIRP) against the company before the National
Company Law Tribunal's (NCLT) Mumbai bench.
In an order dated Dec. 6, 2021 of the National Company Law
Tribunal, Mumbai (NCLT), corporate insolvency resolution process
has been initiated against Reliance Capital as per the provisions
of the Insolvency and Bankruptcy Code (IBC), 2016.
Reliance Capital owes its creditors over INR19,805 crore, majority
of the amount through bonds under the trustee Vistra ITCL India,
The Economic Times of India said.
In February 2022, RBI appointed administrator invited EoIs for sale
of Reliance Capital assets and subsidiaries.
SAPTAGIR LABORATORIES: CARE Keeps C Debt Rating in Not Cooperating
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Saptagir
Laboratories Private Limited (SLPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.95 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 3,
2021, placed the rating(s) of SLPL under the 'issuer
non-cooperating' category as SLPL had failed to provide information
for monitoring of the rating and had not paid the surveillance fees
for the rating exercise as agreed to in its Rating Agreement. SLPL
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated September 19, 2022, September 29, 2022, October
9, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Saptagir Laboratories Private Limited (Erstwhile known as Astrica
Laboratories Private Limited), was incorporated on July 18, 2007
and promoted by Mr. Gopala Krishna and Mr. Bhaskar Rao along with
two other directors. The company has set-up a manufacturing unit
for bulk drugs with an installed capacity of 30,000 kg per annum.
The company achieved commercial operations on October 01, 2016.The
manufacturing unit of the company is located at Medak District,
Telangana. However, the company is planning to increase the
installed capacity to 60,000 kg per annum.
SINGH EDUCATION: CARE Keeps C Debt Rating in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Singh
Education Society (SES) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 4.78 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated January 12,
2022, placed the rating(s) of SES
under the 'issuer non-cooperating' category as SES had failed to
provide information for monitoring of the rating and had not paid
the surveillance fees for the rating exercise as agreed to in its
Rating Agreement. SES continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated November 28, 2022, December 8,
2022, December 18, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Nagpur based, SES is a trust registered under the Societies
Registration Act, 1860. The society is managing Edify School in
Nagpur since 2010. The combined strength of SES is around 665
students with a new enrollment of 99 new students in Academic Year
(AY) 2020-21. The society has started its 11th grade in
AY2020-2021.
SUNPAUL PROPERTIES: CARE Keeps C Debt Rating in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sunpaul
Properties Private Limited (SPPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 9.00 CARE C; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 22,
2021, placed the rating(s) of SPPL under the 'issuer
non-cooperating' category as SPPL had failed to provide information
for monitoring of the rating and had not paid the surveillance fees
for the rating exercise as agreed to in its Rating Agreement. SPPL
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated October 8, 2022, October 18, 2022, October 28,
2022. In line with the extant SEBI guidelines, CARE Ratings Ltd.
has reviewed the rating on the basis of the best available
information which however, in CARE Ratings Ltd.'s opinion is not
sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Sunpaul Properties Private Limited (SPPL) was incorporated on June
18, 2012 and the operation commenced in October 2013. The key
promoter is Mr. Sunny Paul. SPPL belongs to Sunpaul Group of
Companies which has interest in construction and real estate
businesses. Associate concerns Dezira Projects & Realtors Pvt. Ltd.
(DPR) and Sunpaul Dezira Projects Pvt. Ltd (SDP) are property
developers in the Kerala. Mr. Sunny Paul is the Managing director
of the group companies as well. SPPL is engaged in civil
construction of residential and commercial business buildings for
developers. SPPL is a regional player in Kerala state. The company
is also engaged in property development.
V. A. PRODUCTS: CARE Keeps C Debt Rating in Not Cooperating
-----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of V. A.
Products (VAP) continues to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 1.50 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Short Term Bank 4.50 CARE A4; ISSUER NOT
Facilities COOPERATING; Rating continues
to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 19,
2021, placed the rating(s) of VAP under the 'issuer
non-cooperating' category as VAP had failed to provide information
for monitoring of the rating and had not paid the surveillance fees
for the rating exercise as agreed to in its Rating Agreement. VAP
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated October 5, 2022, October 15, 2022, October 25,
2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Incorporated in the year 1994, VAP is a 100% export-oriented unit
(EOU) engaged in manufacturing of precision machined components.
The firm's existing range of products includes hollow screws,
spacer rings, round nuts, bushes, bolts, alternator and starter
motor, sockets, sleeves, housings, pins and bushes. The firm's
customers mainly belong to automobile engineering, aerospace, and
other allied engineering industries. VAP has its warehouses in the
U.S.A. and the U.K.; and caters to numerous international as well
as domestic clients spread across America & Europe.
VISHAL CONDUIT: CARE Keeps C/A4 Debt Rating in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Vishal
Conduit Products Private Limited (VCPPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term/ 5.00 CARE C/CARE A4; ISSUER NOT
Short Term COOPERATING; Rating continues
Bank Facilities to remain under ISSUER NOT
COOPERATING category
Rationale and key rating drivers
CARE Ratings Ltd. had, vide its press release dated November 18,
2021, placed the rating(s) of VCPPL under the 'issuer
non-cooperating' category as VCPPL had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement. VCPPL continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated October 4, 2022, October 15,
2022, October 24, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Vishal Conduit Products Pvt. Ltd. (VCPL), incorporated in 2005 by
the Singh family of Jalandhar Punjab with the objective of
manufacturing of iron & steel products. Since inception, the
company is engaged in manufacturing of mild steel (MS) ingots and
mild steel (MS) pipes. The facility of the company is located at
Jalandhar, Punjab with an annual installed capacity of 12,000 MT
per annum for (MS) ingots and 1200 MT per annum for (MS) pipes. Mr
S Mohinder Singh (Graduate), Managing Director, looks after the day
to day operations of the entity. VCPL also undertook trading of
iron and steel products.
VUDDANDA SOLAR: CARE Keeps D Debt Rating in Not Cooperating
-----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Vuddanda
Solar Power Private Limited (VSPPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 10.82 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated November 01,
2021, placed the rating(s) of VSPPL under the 'issuer
non-cooperating' category as VSPPL had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement. VSPPL continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated September 17, 2022, September
27, 2022, October 7, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Vuddanda Solar Power Private Limited (VSPPL) was incorporated in
2013 and promoted by Mr. M. Balakrishna Reddy along with his
friends. The first solar power project commissioned by VSPPL, of
3.3 MW power, was installed on over 24 acres of land located
Kothapalli, Near Kalikiri, Chittoor District, Andhra Pradesh. FY17
was the first full year of operations of the 3.3 MW plant. VSPPL
has executed this project under third party open access agreement.
The power is being purchased by 4 customers located in Tirupathi
(Andhra Pradesh). VSPPL has entered Power Purchase Agreements
(PPAs) with Bliss Hotels Limited, Bhimas Residency Hotels,
Thirumala Residency Hotels and Sri Vishnu Priya Hotels Private
Limited.
=================
I N D O N E S I A
=================
GARUDA INDONESIA: Two Lessors Seek to Cancel Restructuring Deal
---------------------------------------------------------------
Reuters reports that two lessors have filed applications in a
Jakarta court in a bid to cancel flag carrier Garuda Indonesia's
restructuring deal, a court website showed.
Garuda reached an agreement with its creditors, which include
lessors and Islamic bond investors, last June to restructure more
than $9 billion of debt, the report notes.
The lessors, which filed the applications on Feb. 7, are
Ireland-based firms Greylag Goose Leasing 1410 and 1446, Reuters
discloses. They have also filed multiple lawsuits against Garuda
overseas courts.
In the applications, the lessors also asked the Central Jakarta
court to declare that Garuda failed to conduct its restructuring
deal and to declare the carrier is in bankruptcy, the filing
showed.
Last month, Garuda sued the two Ireland-based lessors at the same
in Jakarta court to counter the lessors' overseas lawsuits with the
first hearing scheduled on May 9, the report adds.
About Garuda Indonesia
Headquartered in Jakarta, Indonesia, government-owned airline PT
Garuda Indonesia -- http://www.garuda-indonesia.com/-- currently
has a fleet of about 77 aircraft offering service to some 27
domestic and 33 international destinations. Under its Citilink
brand, it serves 10 other domestic routes. Garuda also ships about
200,000 tons of cargo a month and operates a computerized tracking
system.
As reported in the Troubled Company Reporter-Asia Pacific on Dec.
14, 2021, Bloomberg News said the airline entered a
court-supervised debt restructuring process after a Jakarta court
on Dec. 9, 2021, accepted a debt petition filed against it. Garuda
and its creditors have 45 days to complete negotiations, which can
be extended to 270 days.
Garuda finalized a restructuring proposal in November 2021 and is
in discussion with creditors and lessors to reduce its liabilities
to US$3.7 billion, from US$9.8 billion, Kartika Wirjoatmodjo, a
deputy at Indonesia's state-owned enterprises ministry, told a
parliamentary hearing.
LIPPO KARAWACI: Moody's Confirms B3 CFR, Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Investors Service has confirmed Lippo Karawaci Tbk (P.T.)'s
B3 corporate family rating and the B3 backed senior unsecured
rating of the notes issued by Theta Capital Pte. Ltd., a
wholly-owned subsidiary of Lippo Karawaci. The notes are guaranteed
by Lippo Karawaci and some of its subsidiaries.
Moody's has also revised the outlook on all ratings to stable from
ratings under review.
This rating action concludes the review for downgrade on the
ratings initiated on January 12, 2023.
On February 3, 2023, Lippo Karawaci announced that it had received
valid tenders of $116.262 million and $108.466 million of its 2025
and 2026 US dollar notes, respectively, following the expiration of
the tender offer exercise. The company has also received the
requisite consent from the noteholders to waive and amend some
terms under the notes. The company will purchase the full amount of
validly tendered notes.
"The transaction is credit positive for the company as it would
partly address its large debt maturity wall over 2025 and 2026,
result in some interest savings annually and demonstrate the
company's access to onshore funding. Nonetheless, Moody's note that
the transaction is negative for noteholders given the covenant
waivers and economic loss on the notes tendered," says Rachel Chua,
a Moody's Vice President and Senior Analyst.
"The B3 ratings continue to reflect Moody's expectations that the
company will remain marginally cash flow negative over the next
12-18 months as the weak operating environment presents challenges
to mass-market housing demand in 2023," adds Chua, who is also the
Lead Analyst for Lippo Karawaci.
RATINGS RATIONALE
While noteholders had to absorb an economic loss as part of the
transaction, Moody's does not view Lippo Karawaci's repurchase of
bonds as a distressed exchange as default avoidance is unclear. The
company has demonstrated clear access to onshore funding channels.
The tender offer will be funded through a new secured seven-year
term loan that Lippo Karawaci has obtained from Bank Negara
Indonesia (Persero) (P.T.) (Baa2 stable) and PT Bank CIMB Niaga Tbk
(Baa2 stable).
Moody's expects Lippo Karawaci to use around $186 million or IDR2.9
trillion to partly purchase the $225 million of note principal
amounts across the 2025 and 2026 notes that were validly tendered.
While this is lower than the IDR6 trillion maximum limit that the
company had planned to purchase, the transaction will allow the
company to cut its total borrowings by $40 million or around
4%-5%.
Moody's also expects annual interest savings of around $2 million.
While refinancing risk is not yet imminent and has been partly
addressed through this exercise, the company still has a
significant debt maturity wall of $289 million of notes maturing in
January 2025 and another $309 million of bonds maturing in October
2026.
At the same time, Moody's notes that while the company's new
capital structure will comprise a higher amount of secured
borrowings, its secured debt-to-total debt ratio will stay below
50%. A directional increase in secured borrowings in the company's
balance sheet will result in legal subordination.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade Lippo Karawaci's rating if (1) the company
improves its core property development business, such that
operating cash flow at the holding company level is positive
without relying on any one-off asset sales; (2) the company reduces
debt at the holding company level; (3) liquidity stays good over
the next 12-18 months and (4) the company addresses its refinancing
requirements through January 2025.
Moody's could downgrade Lippo Karawaci's rating if (1) the
company's operating cash flow deteriorates at the holding company
level and refinancing risk heightens, weakening liquidity; and (2)
there are signs of cash leakage from Lippo Karawaci to affiliated
companies, for example, through intercompany loans, aggressive cash
dividends or investments in affiliates. The senior unsecured note
ratings could also be downgraded if debt is incurred at its
subsidiaries or if more secured borrowings are taken at the holding
company level that result in legal subordination for the unsecured
noteholders.
The principal methodology used in these ratings was Homebuilding
and Property Development published in October 2022.
Lippo Karawaci Tbk (P.T.) and its subsidiaries are engaged in the
development, management and operation of retail malls, hospitals,
hotels, condominiums, and residential townships across multiple
cities in Indonesia. Lippo Karawaci also manages Lippo Malls
Indonesia Retail Trust (B3 negative), a real estate investment
trust (REIT) listed on the Singapore Stock Exchange, in which it
owned a 47% stake as of September 30, 2022.
=====================
N E W Z E A L A N D
=====================
AMRITA NAICKERS: Commences Wind-Up Proceedings
----------------------------------------------
Members of Amrita Naickers Limited on Feb. 7, 2023, passed a
resolution to voluntarily wind up the company's operations.
The company's liquidators are:
Grant Reynolds
Pritesh Patel
Reynolds & Associates Limited
PO Box 259059
Botany, Auckland 2163
BANZPAY TECHNOLOGY: Fitch Affirms BB- LongTerm IDR, Outlook Now Neg
-------------------------------------------------------------------
Fitch Ratings has revised the Outlook on Banzpay Technology
Limited's (BTL) Long-Term Issuer Default Rating (IDR) to Negative
from Stable. At the same time, Fitch has affirmed the Long-Term IDR
of 'BB-' and Short-Term IDR of 'B'.
KEY RATING DRIVERS
Shareholder Support Drives Ratings: BTL's IDRs and Shareholder
Support Rating (SSR) reflect a moderate probability of
extraordinary institutional support from its shareholder, Unity
Credit Union (UCU, BB/Negative/bb). The revision of the Outlook on
BTL's Long-Term IDR to Negative mirrors the Outlook on the parent's
Long-Term IDR.
Strategically Important to Parent: BTL's Long-Term IDR is notched
down once from that of UCU to reflect its view that while BTL is
important to UCU's operation and the two entities have a moderate
level of integration, some of BTL's operations relate to the sale
of products and services to third parties. Fitch believes a default
by BTL would cause high reputational damage to UCU and has the
potential to negatively affect other parts of the UCU group,
because of UCU's 50% ownership and oversight of BTL's businesses.
Any required support is likely to be manageable for UCU.
Viability Rating Not Assigned: Fitch does not assign a Viability
Rating to BTL as Fitch does not believe a standalone analysis is
meaningful. BTL primarily acts as a backend service provider to
UCU. Furthermore, any standalone rating would be well below a
support-driven IDR due to its weak company profile and low
profitability.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
IDRs AND SHAREHOLDER SUPPORT RATING
BTL's Long-Term IDR and SSR could be downgraded if UCU's Long-Term
IDR is downgraded. BTL's Long-Term IDR and SSR could be downgraded,
possibly by multiple notches, if Fitch believes UCU has a reduced
propensity to provide ongoing support to BTL.
A downgrade of BTL's Short-Term IDR would require its Long-Term IDR
to be downgraded to 'CCC+', which appears unlikely, assuming that
UCU's propensity and ability to provide support remains unchanged.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
IDRs AND SHAREHOLDER SUPPORT RATING
The Outlook on BTL's Long-Term IDR would be revised to Stable if
the Outlook on UCU's Long-Term IDR is revised to Stable.
Positive rating action on BTL's Long-Term IDR and SSR would occur
if UCU's Long-Term IDR is upgraded, although this is unlikely, and
the propensity to support remains unchanged. The Long-Term IDR may
also be upgraded if Fitch viewed BTL as a core and integral
subsidiary of UCU, although this is unlikely over the medium term.
An upgrade of the Short-Term IDR would require UCU's Long-Term IDR
to be upgraded by at least three notches, which appears unlikely.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
BTL's ratings are linked to those of its parent, UCU.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Banzpay Technology
Limited LT IDR BB- Affirmed BB-
ST IDR B Affirmed B
Shareholder Support bb- Affirmed bb-
CHRISTIAN SAVINGS: Fitch Affirms BB+ LongTerm IDRs, Outlook Stable
------------------------------------------------------------------
Fitch has affirmed Christian Savings Limited's (CSL) Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDRs) of 'BB+'.
The Outlook is Stable. At the same time, Fitch has affirmed the
Short-Term IDRs at 'B', Viability Rating (VR) at 'bb+' and
Government Support Rating (GSR) at 'ns'.
KEY RATING DRIVERS
Asset Quality, Capital Underpin Ratings: CSL's Long-Term IDRs are
driven by its VR. The VR is supported by CSL's strong asset
quality, capital support and funding profile. However, these
factors are offset by its modest franchise and limited pricing
power relative to the major banks.
Stable Operating Environment: Fitch expects the operating
environment to be broadly stable for New Zealand non-bank deposit
takers (NBDTs) over the next two years, despite its forecast for a
mild recession in 2023. This underpins the stable outlook on its
operating environment score of 'a-', which is below the 'aa'
category score implied by Fitch's criteria due to New Zealand's
high household debt.
Fitch also incorporates the less stringent regulatory oversight of
NBDTs relative to registered banks in the operating environment
assessment, resulting in a score one notch below that of local
banks. New Zealand is in the process of aligning regulation of all
deposit takers under one framework, and Fitch may d consider
aligning the NBDT operating environment score with that of the
banks once this is in place. However, finalisation of this
framework is still a number of years away.
Modest, Niche Franchise: CSL accounts for less than 0.1% of New
Zealand's bank and non-bank system assets, although it is the
country's largest lender within its niche market. CSL's business
profile score of 'bb-' is above the 'b(cat)' implied score due to
its consistent business model and stable performance. This provides
some offset to CSL's limited franchise. CSL also has some
competitive advantages stemming from the close relationships with
its shareholders and borrowers.
Low-Risk Lending Practices: CSL's risk appetite score of 'bb+' is
two notches above the business profile score. This reflects the
company's conservative approach to loan origination and low
loan/value ratio. CSL's close relationships with its customer base
allows it to make more informed decisions on borrowing capacity and
repayment ability. Risk controls are appropriate for the
organisation size and not dissimilar to those of peers.
Strong Loan Performance: Fitch expects CSL's impaired-loan ratio to
remain low over the next two years. CSL reported no arrears greater
than 30 days at the end of the financial year ending August 2022
(FY22), and Fitch expects this to continue in FY23 due to CSL's
underwriting and strong collateral positions across its loan
portfolio. Fitch adjusts CSL's asset quality score to 'bbb-', below
the implied 'aa(cat)' score, due to a high level of single-name and
segment concentration.
Steady Growth in Profitability: Fitch expects loan growth and a
broadly stable interest margin to sustain higher earnings at CSL.
However, the core metric, operating profit/risk-weighted assets,
may moderate from the higher levels in FY22 due to the release of
provisions related to the Covid-19 pandemic. The assigned score of
'bb+' is lower than the implied 'bbb(cat)' score to reflect CSL's
concentration and low revenue diversification.
Appropriate Capital Buffers: Fitch believes CSL's Fitch core
capital and total regulatory capital ratios will stay at the
higher-end of its peer group. However, a modest decline is possible
amid its expectation of strong loan growth over the next two years.
CSL's regulatory capital ratio stood at 14.7% at FYE22. Fitch has
maintained the factor score of 'bb+', below the implied 'a(cat)'
score, due to the small absolute size of CSL's capital base.
Operations Wholly Deposit Funded: Fitch expects a stable funding
and liquidity profile. CSL's core metric, the loan/customer deposit
ratio, is likely to remain at around 90% over the next two years.
The four-year average of the metric implies a 'a(cat)' score, but
Fitch applies a negative adjustment to reflect CSL's lack of access
to the Reserve Bank of New Zealand lender of last resort liquidity
facilities.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
IDRS AND VR
The ratings are sensitive to a loss of support from CSL's target
market, as this would ultimately diminish the company's viability.
Negative rating action may also be taken if CSL's risk profile
deteriorates through a loosening in underwriting standards, risk
controls or aggressive growth, as this is likely to weaken its core
financial metrics. This could trigger a downgrade if a combination
of the following were to occur:
- the stage 3/gross loans ratio increases above 8% on a consistent
basis;
- operating profit/risk-weighted assets falls below 0.5% on a
sustained basis;
- the Fitch core capital ratio declines below 11.5% without a clear
path to return to above this level;
Alternatively, Fitch may downgrades the VR and Long-Term IDRs if
the loan/customer deposits ratio remains significantly above 100%
as it may indicated a weakening in the business model and risk
profile.
CSL's Short-Term IDR would only be downgraded if the Long-Term IDR
were downgraded to 'CCC+' or below.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
IDRS AND VR
An upgrade of the Long-Term IDRs and VR is unlikely in the short
term, as this would require significant growth in CSL's franchise.
An upgrade of the Short-Term IDR would require an upgrade of the
Long-Term IDR to at least 'BBB-'.
GSR
The GSR is already at the lowest level on Fitch's rating scales and
cannot be downgraded.
An increased propensity for New Zealand's authorities to provide
support would be required for an upgrade of the GSR, but this
appears unlikely in light of the resolution framework in place and
CSL's small size relative to the country's overall financial
system.
VR ADJUSTMENTS
The operating environment score of 'a-' has been assigned below the
'aa' category implied score because of the following adjustment
reasons: level and growth of credit (negative), regulatory and
legal framework (negative).
The business profile score of 'bb-' has been assigned above the 'b'
category implied score because of the following adjustment reason:
business model (positive).
The asset-quality score of 'bbb-' has been assigned below the 'aa'
category implied score because of the following adjustment reason:
concentration (negative)
The earnings and profitability score of 'bb+' has been assigned
below the 'bbb' category implied score because of the following
adjustment reason: revenue diversification (negative)
The capitalisation and leverage score of 'bb+' has been assigned
below the 'a' category implied score because of the following
adjustment reason: size of capital base (negative).
The funding and liquidity score of 'bbb-' has been assigned below
the 'a' category implied score because of the following adjustment
reason: liquidity access and ordinary support (negative).
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Christian Savings
Limited LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Viability bb+ Affirmed bb+
Government Support ns Affirmed ns
CONSTRUCTION 41: Commences Wind-Up Proceedings
----------------------------------------------
Members of Construction 41 Limited on Feb. 3, 2023, passed a
resolution to voluntarily wind up the company's operations.
The company's liquidator is:
Grant Reynolds
Reynolds & Associates Limited
PO Box 259059
Botany, Auckland 2163
CULLEN INVESTMENTS: Liquidators Chase Eric Watson for Debt Payment
------------------------------------------------------------------
Stuff.co.nz reports that the liquidators of Cullen Investments are
chasing former high-flying Kiwi businessman Eric Watson for
repayment of AUD57 million he borrowed from his failed company.
In the High Court in Auckland on Feb. 7, Justice Neil Campbell
ruled in favour of the liquidators KPMG, noting it was a
straightforward claim for money owing as a result of advances made
to Mr. Watson over several years when he was a director of the
company, Stuff relates.
According to Stuff, Justice Campbell said he was satisfied that Mr.
Watson had no defence to the claim. Neither Mr. Watson nor his
lawyer were present.
Leon Bowker of KPMG said they would now be looking to enforce the
judgment.
"We have a court enforceable judgment against Eric Watson now. We
will be looking to enforce that judgment and try and collect that
money from him. In the event that he chooses not to pay we'll be
looking to bankrupt him," Stuff quotes Mr. Bowker as saying.
He noted that the Official Assignee, which administers
bankruptcies, could apply for help from overseas courts which could
have implications for any assets Mr. Watson had overseas, as well
as any New Zealand assets, Stuff relays.
Mr. Watson has previously proved elusive when creditors have tried
to serve legal papers, although he is believed to be in Ibiza.
As reported in the Troubled Company Reporter-Asia Pacific on Dec.
25, 2019, BusinessDesk said nine other Eric Watson-linked companies
have been moved into liquidation following the collapse of Cullen
Group. According to BusinessDesk, Cullen Group was moved into
liquidation by court order earlier in December 2019 after a High
Court judge refused to halt insolvency proceedings against it.
KPMG's Vivian Fatupaito was appointed liquidator by associate judge
Hannah Sargisson on Dec. 17, 2019. Since then, nine other entities
linked to Watson have also gone under.
FIRST CREDIT: Fitch Affirms LongTerm IDRs at 'BB', Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has affirmed New Zealand-based First Credit Union's
(FCU) Long-Term Issuer Default Ratings (IDRs) at 'BB', Short-Term
IDRs at 'B' and Viability Rating (VR) at 'bb'. The Outlook is
Stable.
KEY RATING DRIVERS
FCU's Long-Term IDRs are driven by its VR, which is assigned in
line with the implied VR. The VR captures a greater risk appetite
relative to New Zealand banks and building societies. A larger
exposure to personal loans than sector peers makes FCU's financial
profile more volatile through the cycle. The ratings also capture
FCU's small franchise compared with the system and geographic
concentration in parts of New Zealand.
Stable Operating Environment: Fitch expects the operating
environment to be broadly stable for New Zealand non-bank deposit
takers (NBDTs) over the next two years, despite its forecast for a
mild recession in 2023. This underpins the stable outlook on its
operating environment score of 'a-', which is below the 'aa'
category score implied by Fitch's criteria to reflect New Zealand's
high household debt.
Fitch also incorporates the less stringent regulatory oversight of
NBDTs relative to registered banks in the operating environment
assessment, resulting in a score one notch below that of local
banks. New Zealand is in the process of aligning regulation of all
deposit takers under one framework, and Fitch may considers
aligning the NBDT operating environment score with that of the
banks once this is in place. However, finalisation of this
framework is still a number of years away.
Concentrated, Consistent Business Model: FCU's simple and
consistent business model partly offsets the credit union's small
market position, contributing to Fitch assigning a business profile
factor score of 'bb', above the 'b(cat)' implied score. FCU
accounts for less than 0.1% of combined bank and NBDT system
assets, which limits is pricing power.
Higher Exposure to Non-Mortgage Loans: FCU has greater exposure to
consumer loans than most New Zealand bank and building-society
peers, which Fitch considers as indicative of above-average risk
appetite. The proportion of non-mortgage consumer loans in FCU's
loan book, at 24% in the financial year ended June 2022 (FY22), has
dropped over recent years as a result of weaker consumer spending
and the rise of buy-now-pay-later offerings, but remains high
relative to broader sector peers.
Modest Asset-Quality Weakening: Fitch expects modest weakening of
FCU's impaired loan ratio over the next two years, as the impact of
sharply higher interest rates is felt by borrowers. However, low
unemployment and FCU's reduction in consumer loans over recent
years should limit the deterioration. The factor score of 'bb' is
lower than the implied 'bbb' category score due to FCU's product
and geographic concentration.
Profitability Below Peers: Fitch expects FCU's profitability
metrics to be weaker than those of most peers over FY23 and FY24,
driven by the merger with two smaller credit unions. Over the
long-term, Fitch believes profitability will improve once the
mergers are fully integrated and cost synergies are achieved. FCU's
net interest margin may expand in the short-term because of rising
rates, although competition, slower loan growth and higher expenses
may offset the benefit to earnings.
Robust Capital Buffers: Fitch expects modest weakening in the Fitch
core capital and total regulatory capital ratios in FY23 as a
result of the merger activity, but for FCU to maintain strong
buffers over regulatory minimums. Its forecast for modest loan
growth means capitalisation is unlikely to be pressured over the
next two years, however, retained earnings generation is also
likely to be weaker. The assigned 'bb+' score is below the implied
'a(cat)' score due to the small absolute size of the capital base
of just NZD64 million (USD40 million) at FYE22.
Fully Deposit Funded: Fitch expects FCU's funding profile to remain
stable over the next two years. The core metric is likely to
improve modestly as a result of the merger activity in 2022. Fitch
has applied a negative adjustment on FCU's funding score of 'bbb-'
from the 'a' category implied score to reflect the lack of access
to the Reserve Bank of New Zealand's liquidity facilities.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
IDRS AND VR
The Long-Term IDRs and VR may be downgraded upon a deterioration in
FCU's risk profile, potentially aimed at increasing market share
and profitability, that leads to greater volatility in the
financial profile through the cycle. This may be reflected in a
combination of the following:
- impaired loans/gross loans increasing above 10% on a consistent
basis;
- operating profit/risk-weighted assets falling to below 0.25% for
a sustained period;
- the total regulatory capital ratio declining to below 9.5%
without a credible plan to replenish regulatory capital buffers;
or
Alternatively, Fitch may downgrade the VR and Long-Term IDRs if the
loan/customer deposits ratio remains significantly above 100%, as
it may indicate a weakening in the business model and risk
profile.
The Short-Term IDR would only be downgraded if the Long-Term IDR
was downgraded to 'CCC+' or below.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
IDRS AND VR
An upgrade of the VR and Long-Term IDRs is unlikely in the short
term, as it would require a significant improvement in the risk
profile that results in more stable asset quality and earnings
through the cycle.
An upgrade of the Short-Term IDR would require an upgrade of the
Long-Term IDR to at least 'BBB-'.
The Government Support Rating (GSR) of 'ns' (no support) reflects
its view that there is no reasonable assumption that support from
the New Zealand sovereign would be forthcoming if required. Fitch
believes the existence of an open bank resolution scheme lowers the
propensity of the sovereign to support its banks. The scheme allows
for the imposition of losses on depositors and senior debt holders
to recapitalise a failed institution.
GSR
The GSR is already at the lowest level on Fitch's rating scale and
cannot be downgraded.
An increased propensity for the New Zealand authorities to provide
support would be required for an upgrade of the GSR, but appears
unlikely in light of the resolution framework in place and FCU's
small size relative to the country's overall financial system.
VR ADJUSTMENTS
The operating environment score of 'a-' has been assigned below the
'aa' category implied score because of the following adjustment
reasons: level and growth of credit (negative), regulatory and
legal framework (negative).
The business profile score of 'bb' has been assigned above the 'b'
category implied score because of the following adjustment reason:
business model (positive).
The asset quality score of 'bb' has been assigned below the 'bbb'
category implied score because of the following adjustment reason:
concentration (negative)
The capitalisation and leverage score of 'bb-' has been assigned
below the 'a' category implied score because of the following
adjustment reason: size of capital base (negative).
The funding and liquidity score of 'bbb-' has been assigned below
the 'a' category implied score because of the following adjustment
reasons: liquidity access and ordinary support (negative).
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
First Credit
Union LT IDR BB Affirmed BB
ST IDR B Affirmed B
LC LT IDR BB Affirmed BB
LC ST IDR B Affirmed B
Viability bb Affirmed bb
Government Support ns Affirmed ns
JOHNSON CORNER: Creditors' Proofs of Debt Due on Feb. 19
--------------------------------------------------------
Creditors of Johnson Corner Ngamotu Limited are required to file
their proofs of debt by Feb. 19, 2023, to be included in the
company's dividend distribution.
The company commenced wind-up proceedings on Jan. 19, 2023.
The company's liquidator is:
Mohammed Tazleen Nasib Jan
Liquidation Management Limited
PO Box 50683
Porirua 5240
LOG AND ROAD: Creditors' Proofs of Debt Due on March 10
-------------------------------------------------------
Creditors of Log and Road Limited are required to file their proofs
of debt by March 10, 2023, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on Feb. 3, 2023.
The company's liquidators are:
Craig Sanson
Stephen White
c/o PwC
Private Bag 92162
Victoria Street West
Auckland 1142
NELSON BUILDING: Fitch Alters Outlook on 'BB+' LongTerm IDRs to Pos
-------------------------------------------------------------------
Fitch Ratings has revised the Outlook on Nelson Building Society's
(NBS) Long-Term Foreign- and Local-Currency Issuer Default Ratings
(IDRs) of 'BB+' to Positive, from Stable. The Long-Term IDRs are
affirmed at the same time, as were the Short-Term IDRs at 'B', the
Viability Rating (VR) at 'bb+' and the Government Support Rating
(GSR) at 'ns' (no support).
The Outlook revision reflects the industry consultation to
implement a common equity capital instrument for mutual entities -
like NBS - during 2023, which should allow the lender to boost its
capitalisation, a current rating weakness.
KEY RATING DRIVERS
Profitability, Asset Quality Underpin Ratings: NBS's IDRs are
driven by its VR, which is one notch below the implied VR due to a
negative adjustment to reflect core capitalisation that is weaker
than that of peers. The VR is supported by NBS's leading
profitability among New Zealand's non-bank deposit taker (NBDT)
sector and sound asset quality. NBS is the country's largest NBDT,
but its market share remains small relative to the overall banking
system.
Instrument May Bolster Capital: Fitch expects a steady organic
improvement in NBS's capital ratios over the medium term, supported
by its profitability. Fitch has revised the outlook on the 'bb'
factor score to positive, from stable, as the development of a core
capital instrument may allow NBS to bolster its Fitch Core Capital
ratio more quickly, addressing the weakness in its VR. This
underpins the Positive Outlook on the Long-Term IDRs.
The high influence of NBS's capitalisation factor score reflects
the negative adjustment on its implied VR, as capitalisation is
NBS's weakest financial profile factor. NBS's capitalisation score
of 'bb' is above the 'b' category implied score, supported by a
total capital ratio of 12.9% at end-2022, well above the 8.0%
regulatory minimum. This is NBS's only regulatory capital
requirement.
Stable Operating Environment: Fitch expects the operating
environment to be broadly stable for New Zealand NBDTs over the
next two years, despite its forecast for a mild recession in 2023.
This underpins the stable outlook on the operating environment
score of 'a-' for NBDTs, which is below the 'aa' category score
implied by Fitch's criteria to reflect the country's high household
debt. Its operating environment assessment also incorporates the
less stringent regulatory oversight of NBDTs relative to registered
banks, resulting in a score one notch below that of New Zealand
banks.
New Zealand is in the process of aligning regulation of all deposit
takers under one framework, and Fitch may consider aligning the
NBDT operating environment score with that of New Zealand banks
once this is in place. However, finalisation of this framework is
still a number of years away.
Simple, Consistent Business Model: NBS's business profile factor
score of 'bb+' is above the 'b' category implied score, reflecting
the society's simple and consistent business model, which offsets
its modest franchise and limited pricing power. Fitch expects NBS
to continue to focus on the provision of lower risk residential
mortgages and secured SME loans. NBS is the largest NBDT in New
Zealand by total assets, but accounted for less than 0.2% of total
banking and NBDT system assets at end-September 2022.
Low-Risk Mortgage Focus: NBS's risk profile score of 'bbb-' is one
notch above the business profile score to reflect its focus on
residential mortgages with lower loan/value ratios. Commercial and
non-mortgage consumer exposures have increased as a proportion of
total loans in recent years, but Fitch believes the risks
associated with these loans are adequately addressed through NBS's
control and limit framework.
Modest Asset-Quality Weakening: Fitch expects some modest weakening
of NBS's stage 3 loan ratio over the next two years, as the impact
of sharply higher interest rates is felt by borrowers. However, low
unemployment and NBS's risk profile should limit the deterioration.
The factor score of 'bbb' is lower than the implied 'aa' category
score due to the society's product and geographic concentration.
Profitability Above Peers: Fitch expects NBS's profitability to
remain sound and stronger than that of its NBDT peers over the next
two years and have upgraded the earnings factor score to 'bbb',
from 'bbb-'. NBS's net interest margin may expand in the short-term
because of rising rates, although competition, slower loan growth
and higher expenses may offset the benefit to earnings.
Fully Deposit Funded: Fitch expects NBS's funding profile to remain
reasonably stable over the next two years. Fitch has applied a
negative adjustment on NBS's funding score of 'bbb-' from the 'a'
category implied score to reflect the society's lack of access to
the Reserve Bank of New Zealand's liquidity facilities.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
IDRS AND VR
Fitch may revises the Outlook to Stable should NBS's core capital
improvement be slower than Fitch expects, resulting in the
society's Fitch core capital ratio continuing to significantly
trail that of peers.
The ratings may be downgraded, although this appears unlikely, if
there is an increase in the risk profile - aimed potentially at
boosting market share and profitability - that leads to greater
volatility in the financial profile through the cycle. It may be
reflected in a combination of the following:
- stage 3 loans/gross loans increasing above 8% for a sustained
period (FY19-FY22 average: 0.2%);
- operating profit/risk-weighted assets falling below 0.5% for a
sustained period (FY19-FY22 average: 1.7%); and
- the regulatory total capital ratio declining below 9.5% without a
credible plan to replenish regulatory capital buffers.
Alternatively, Fitch may downgrades the VR and Long-Term IDRs if
the loan/customer deposits ratio remains significantly above 100%,
as it may indicate a weakening in the business model and risk
profile.
A downgrade of the Short-Term IDRs appears unlikely, as this would
require a downgrade of the Long-Term IDRs to 'CCC+' or below.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
IDRS AND VR
The ratings may be upgraded if the society can increase its
regulatory capital ratio to above 15% or its Fitch core capital
ratio to around 14% and sustain it at this level. At the same time,
core financial metrics for asset quality, earnings and funding
should remain broadly stable. An improvement in risk controls to be
more in line with that of New Zealand's registered banks would also
be positive for the ratings.
An upgrade of the Short-Term IDR would require an upgrade of the
Long-Term IDR to 'BBB-' or higher.
The GSR reflects its view that there is no reasonable assumption
that support from the New Zealand sovereign would be forthcoming if
required. Fitch believes the existence of an open bank resolution
scheme lowers the propensity of the sovereign to support its banks.
The scheme allows for the imposition of losses on depositors and
senior debt holders to recapitalise a failed institution.
GSR
The GSR is already at the lowest level on Fitch's rating scale and
cannot be downgraded.
An increased propensity for the New Zealand authorities to provide
support would be required for an upgrade of the GSR, but appears
unlikely in light of the resolution framework in place and NBS's
small size relative to the country's overall financial system.
VR ADJUSTMENTS
The VR of 'bb+' has been assigned below the 'bbb-' implied VR
because of the following adjustment reason: weakest link -
capitalisation and leverage (negative).
The operating environment score of 'a-' has been assigned below the
'aa' category implied score because of the following adjustment
reason: level and growth of credit (negative), regulatory and legal
framework (negative).
The business profile score of 'bb+' has been assigned above the 'b'
category implied score because of the following adjustment reason:
business model (positive).
The asset quality score of 'bbb-' has been assigned below the 'aa'
category implied score because of the following adjustment reason:
concentrations (negative)
The capitalisation and leverage score of 'bb' has been assigned
above the 'b' category implied score because of the following
adjustment reason: regulatory capital (positive).
The funding and liquidity score of 'bbb-' has been assigned below
the 'a' category implied score because of the following adjustment
reason: liquidity access and ordinary support (negative).
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Nelson Building
Society LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Viability bb+ Affirmed bb+
Government Support ns Affirmed ns
TALLENTYRE TRUSTEE: Court to Hear Wind-Up Petition on Feb. 24
-------------------------------------------------------------
A petition to wind up the operations of Tallentyre Trustee Company
Limited will be heard before the High Court at Auckland on Feb. 24,
2023, at 10:00 a.m.
Body Corporate 197236 filed the petition against the company on
Nov. 11, 2022.
The Petitioner's solicitor is:
Vinnie Kumar
Doug Cowan Barristers & Solicitors
486 New North Road
Kingsland, Auckland 1021
UNITY CREDIT: Fitch Alters Outlook on 'BB' LongTerm IDRs to Neg.
----------------------------------------------------------------
Fitch Ratings has revised the Outlooks on New Zealand-based Unity
Credit Union's (UCU) Long-Term Foreign- and Local-Currency Issuer
Default Ratings (IDRs) of 'BB' to Negative from Stable. Fitch has
affirmed the Long-Term IDRs, Short-Term IDRs of 'B', Viability
Rating (VR) of 'bb' and Government Support Rating (GSR) of 'ns' at
the same time.
The Negative Outlook reflects risks in the current environment to
the new management team's strategy to improve asset quality,
earnings and capitalisation, which are all weaker than metrics
reported by UCU's non-bank deposit-taker (NBDT) peers in New
Zealand. The plan involves rebalancing the loan portfolio towards
residential mortgages and away from unsecured personal lending, but
this may be difficult in an environment of rapid interest rate
increases to combat inflation and strong competition.
KEY RATING DRIVERS
Risk Profile Weaker than Peers: UCU's Long-Term IDRs are driven by
its VR, which is assigned in line with the implied VR. The VR
captures UCU's larger risk appetite relative to other New Zealand
NBDTs, as reflected in a historical focus on unsecured consumer
loans and residential mortgages with a higher loan/value ratio
(LVR), as well as a moderate market position and some geographic
concentration.
Stable Operating Environment: Fitch expects the operating
environment to be broadly stable for New Zealand NBDTs over the
next two years despite our forecast of a mild recession in 2023.
This underpins the stable outlook on its operating environment
score of 'a-' for NBDTs, which is below the 'aa' category score
implied by Fitch's criteria to reflect the high household debt in
New Zealand.
Fitch also incorporates the less stringent regulatory oversight for
NBDTs relative to registered banks in the operating environment
assessment, resulting in a score one notch below New Zealand banks.
New Zealand is in the process of aligning regulation of all deposit
takers under one framework, and Fitch may consider aligning the
NBDT operating environment score with that of New Zealand banks
once this is in place. However, finalisation of this framework is
still a number of years away.
Revised Strategy Key: UCU's plan to rebalance its loan portfolio
towards lower-risk residential mortgages is key to the credit union
restoring profitability and rebuilding capital buffers, and
underpins our 'bb-' business profile score, which is above the
implied 'b' category score. Fitch has lowered the factor score from
'bb' and maintain a negative outlook to reflect the weakness in the
previous strategy, which focused on unsecured consumer lending, and
the challenges UCU faces in rebalancing its loan portfolio.
Asset Quality Weakening: Fitch expects the impaired loan/gross
loans ratio to weaken in the financial year to end-June 2023
(FY23), from 3.6% at FYE22, as UCU works through its legacy
personal loan portfolio and higher interest rates hit the broader
loan book. Asset quality should improve in FY24. Fitch has revised
the outlook on the 'bb' factor score to negative to reflect
downside risks to these metrics as the loan book is rebalanced.
Fitch adjusts the factor score from the implied 'bbb' category due
to geographic and product concentrations.
Earnings Below Peers: Fitch expects UCU to report a substantial
operating loss in FY23, with the net interest margin falling as the
loan book rebalances, further loan contraction, and impairment
charges that are likely to remain elevated as a result of the
weaker asset quality. Beyond this, Fitch expects modest
profitability to return in FY24. Fitch has revised the factor score
to 'bb-' from 'bb' and revised the factor outlook to negative to
capture this.
Capital Buffers Remain Modest: Fitch has revised the outlook on
UCU's capitalisation and leverage score of 'bb-' to stable from
positive, as Fitch now expects UCU to take more than two years to
rebuild capital buffers back toward levels reported by other NBDTs.
The small absolute capital base (equivalent to USD38 million at
FYE22) means Fitch adjusts down from the 'bbb' category implied
score.
Stable Funding and Liquidity Profile: Fitch expects UCU to remain
completely deposit-funded, with a loans/customer-deposits ratio of
around 85% through to FY24. This underpins our factor score of
'bbb-'. The score remains below the implied 'a' category score to
reflect that UCU has no access to the central bank's
lender-of-last-resort facilities, leaving the credit union
susceptible to deposit outflow in a severe funding-market shock.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
IDRs AND VR
The Long-Term IDRs and VR may be downgraded if UCU is unsuccessful
in rebalancing the loan portfolio and restoring balance sheet
growth, profitability and capital buffers. This would likely result
in Fitch lowering multiple factor scores. In particular, a lower
earnings score could result in a downgrade even if the implied VR
remains at 'bb', as retained earnings remains the primary source of
capital accumulation for UCU and capital buffers remain modest.
The above scenario may be reflected in one or more of the
following:
- impaired loans/gross loans increase above 10% on a consistent
basis (FY19-FY22 average of 2.7%) or write-off rates continue to
increase, masking the underlying asset quality of the portfolio;
- Fitch expects operating losses and/or only marginal operating
profits to be reported for a sustained period (FY19-FY22 average of
0.1%); or
- the regulatory total capital ratio declines below 9.5% without a
credible plan to replenish regulatory capital buffers (9.7% at
end-September 2022).
Alternatively, Fitch may downgrades the VR and Long-Term IDRs if
the loan/customer deposits ratio is sustained significantly above
100%, as it may indicate a weakening in the business model and risk
profile.
UCU's Short-Term IDRs would only be downgraded if the Long-Term
IDRs were downgraded to 'CCC+' or below.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
IDRs and VR
The Outlook on UCU's Long-Term IDRs may be revised to Stable if the
credit union is successful in rebalancing its loan portfolio
towards lower-risk residential mortgages, restoring balance sheet
growth and profitability. This should in turn improve asset-quality
metrics and result in improved capital ratios, with buffers to the
regulatory minimum increasing. This may be reflected in the
operating profit/risk-weighted assets ratio being maintained
consistently above 0.25% and the total capital ratio above 10.5%.
An upgrade of the VR and Long-Term IDRs appears unlikely in the
short term.
An upgrade of the Short-Term IDRs would require an upgrade of the
Long-Term IDRs to at least 'BBB-'.
The GSR of 'ns' assigned to UCU reflects its expectation that there
is no reasonable assumption of support being forthcoming because of
New Zealand's open bank resolution scheme (OBR). UCU is not part of
the OBR, which allows for the imposition of losses on depositors
and senior debt holders to recapitalise failed institutions.
However, Fitch believes that the existence of the scheme, in
conjunction with UCU's low systemic importance, makes sovereign
support doubtful.
GSR
The GSR is already at the lowest level on Fitch's rating scales and
cannot be downgraded further.
An increased propensity for the New Zealand authorities to support
would be required for an upgrade of the GSR, but appears unlikely
in light of the resolution framework in place and UCU's small size
relative to the country's overall financial system.
VR ADJUSTMENTS
The operating environment score of 'a-' has been assigned below the
'aa' category implied score because of the following adjustment
reasons: level and growth of credit (negative), regulatory and
legal framework (negative).
The business profile score of 'bb' has been assigned above the 'b'
category implied score because of the following adjustment reason:
historical and future developments (positive).
The asset-quality score of 'bb' has been assigned below the 'bbb'
category implied score because of the following adjustment reason:
concentrations (negative)
The capitalisation and leverage score of 'bb-' has been assigned
below the 'bbb' category implied score because of the following
adjustment reason: size of capital base (negative).
The funding and liquidity score of 'bbb-' has been assigned below
the 'a' category implied score because of the following adjustment
reason: liquidity access and ordinary support (negative).
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Unity Credit Union LT IDR BB Affirmed BB
ST IDR B Affirmed B
LC LT IDR BB Affirmed BB
LC ST IDR B Affirmed B
Viability bb Affirmed bb
Government Support ns Affirmed ns
WAIRARAPA BUILDING: Fitch Affirms BB+ LongTerm IDRs, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has affirmed New Zealand-based Wairarapa Building
Society's (WBS) Long-Term Foreign- and Local-Currency Issuer
Default Ratings (IDRs) of 'BB+'. The Outlook is Stable. Fitch has
also affirmed the Short-Term IDRs of 'B', Viability Rating (VR) of
'bb+' and Government Support Rating (GSR) of 'ns'.
KEY RATING DRIVERS
VR Underpins Ratings: WBS's Long-Term IDRs are driven by its VR,
which is assigned in line with the implied VR. The VR reflects
steady asset quality and satisfactory capitalisation. WBS's
resilient asset quality supports its credit profile, reflecting the
society's underwriting standards, which are generally consistent
with those of peers.
Stable Operating Environment: Fitch expects the operating
environment to be broadly stable for New Zealand non-bank deposit
takers (NBDTs) over the next two years despite its forecast for a
mild recession in 2023. This underpins the stable outlook on its
operating environment score of 'a-' for NBDTs, which is below the
'aa' category score implied by Fitch's criteria to reflect the high
household debt in New Zealand.
Fitch also incorporates the less stringent regulatory oversight of
NBDTs relative to registered banks in the operating environment
assessment, resulting in a score one notch below that of New
Zealand banks. New Zealand is in the process of aligning regulation
of all deposit takers under one framework, and Fitch may consider
aligning the NBDT operating environment score with that of New
Zealand banks once this is in place. However, finalisation of this
framework is still a number of years away.
Simple Business Model: WBS has a modest franchise with a market
share of less than 0.1% of total banking and NBDT system assets.
This means it is generally a price-taker in its main operating
segments and has limited competitive advantages. Fitch views the
consistent and stable business model focused on residential
mortgages as a positive for the rating, contributing to the
business profile score of 'bb-', which is above the implied 'b'
category score.
Manageable Asset-Quality Weakening: Fitch expects a modest
weakening in WBS's stage 3 loan ratio over the next two years as
the sharp increase in interest rates pressures some borrowers.
However, WBS's focus on low loan-to-value ratio residential
mortgages along with low unemployment should limit this
deterioration. The factor score of 'bb+' is below the implied 'a'
category score due to WBS's product and geographical
concentration.
Consistent Profitability: WBS's earnings and profitability metrics
have consistently been among the best of its peer group and Fitch
expects this to continue over the next two years. The four-year
average of the society's core metric, operating
profit/risk-weighted asset ratio, improved to 1.5% in the financial
year ended March 2022 (FY22). The assigned score is below the
implied 'bbb' category score due to WBS having less diverse revenue
streams than larger peers in New Zealand.
Sound Capitalisation: Fitch expects WBS to maintain sound capital
ratios and remain towards the top end of its peer group over the
next two years. The Fitch Core Capital (FCC) ratio moderately
weakened to 15.2% in 1HFY23, implying a score in the lower half of
the 'a' category. Total capital also fell to 15.2% by end-1HFY23,
although this still gives solid buffers over board and regulatory
minimums.
Fitch views these buffers as appropriate given the small absolute
size of the society's capital base (NZD24 million or USD17 million
at end-March 2022), although this leaves it more vulnerable to
negative shocks than larger peers. The assigned 'bb+' factor score
is below the implied score to reflect this risk.
Funding Ratios to Weaken: Fitch expects the loan/customer deposit
ratio to continue weakening through the remainder of FY23 due to
strong loan growth over the period. Fitch expects any weakening to
be manageable, and all non-equity funding to remain in the form of
deposits, meaning downward pressure on the 'bbb-' factor score is
unlikely. This is below the implied 'a' category score to reflect
that WBS does not have access to lender-of-last resort facilities
at the central bank.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
IDRS AND VR
WBS's Long-Term IDRs and VR may be downgraded if there is
deterioration in the risk profile, potentially aimed at expanding
market share and profitability, which leads to greater volatility
in the financial profile through the cycle.
The above scenario may be reflected in a combination of the
following:
- impaired loans/gross loans increasing to above 8% for a sustained
period (FY19-FY22 average of 1.1%);
- operating profit/risk-weighted assets falling to below 0.5% for a
sustained period (FY19-FY22 average of 1.5%); or
- the FCC ratio declining to below 11.5% without a credible plan to
replenish regulatory capital buffers (15.2% at 1HFY23)
Alternatively, Fitch may downgrade the VR and Long-Term IDRs if the
loan/customer deposit ratio is sustained significantly above 100%
as this may indicate a weakening in the business model and risk
profile.
The Short-Term IDRs would only be downgraded if the Long-Term IDR
were downgraded to 'CCC+' or below.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
IDRS AND VR
An upgrade of WBS's Long-Term IDRs and VR appears unlikely as this
would require a significant increase in its market share without
materially weakening its underwriting standards and overall risk
profile. This would also require sustained improvements in a number
of WBS's financial metrics.
The Short-Term IDRs would be upgraded if the Long-Term IDR were to
be upgraded to at least 'BBB-'.
The GSR of 'ns' (no support) reflects its view that there is no
reasonable assumption that support from the New Zealand sovereign
would be forthcoming if required. Fitch believes that the existence
of an open bank resolution scheme lowers the propensity of the
sovereign to support its banks. The scheme allows for the
imposition of losses on depositors and senior debt holders to
recapitalise a failed institution.
GSR
The GSR is already at the lowest level on Fitch's rating scales and
cannot be downgraded further.
An increased propensity for the New Zealand authorities to support
would be required for an upgrade of the GSR, but appears unlikely
in light of the resolution framework in place and WBS's small size
relative to the country's overall financial system.
VR ADJUSTMENTS
The operating environment score of 'a-' has been assigned below the
'aa' category implied score because of the following adjustment
reason: level and growth of credit (negative), regulatory and legal
framework (negative).
The business profile score of 'bb+' has been assigned above the 'b'
category implied score because of the following adjustment reason:
business model (positive).
The asset quality score of 'bbb-' has been assigned below the 'aa'
category implied score because of the following adjustment reason:
concentrations (negative)
The earnings and profitability score of 'bb+' has been assigned
below the 'aa' category implied score because of the following
adjustment reason: revenue diversification (negative)
The capitalisation and leverage score of 'bb' has been assigned
below the 'bbb' category implied score because of the following
adjustment reason: size of capital base (negative).
The funding and liquidity score of 'bbb-' has been assigned below
the 'a' category implied score because of the following adjustment
reason: liquidity access and ordinary support (negative).
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Wairarapa Building
Society LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
LC LT IDR BB+ Affirmed BB+
LC ST IDR B Affirmed B
Viability bb+ Affirmed bb+
Government Support ns Affirmed ns
WELLY BUILDS: Creditors' Proofs of Debt Due on March 15
-------------------------------------------------------
Creditors of Welly Builds Limited and Topline Kitchens Limited are
required to file their proofs of debt by March 15, 2023, to be
included in the company's dividend distribution.
Iain McLennan and Boris van Delden of McDonald Vague were appointed
joint and several liquidators of Welly Builds on Jan. 31, 2023.
Colin Sanderson and Keaton Pronk of McDonald Vague were appointed
joint and several liquidators of Topline Kitchens on Feb. 2, 2023.
The Liquidators may be reached:
McDonald Vague Limited
PO Box 6092
Victoria Street West
Auckland 1142
=================
S I N G A P O R E
=================
3D METALFORGE: Commences Wind-Up Proceedings
--------------------------------------------
Members of 3D Metalforge Pte Ltd and 3D Matters Pte Ltd on Feb. 3,
2023, passed a resolution to voluntarily wind up the company's
operations.
The company's liquidators are Luke Anthony Furler and Ellyn Tan
Huixian of Quantuma (Singapore) Pte Limited.
MIDAS NSSG: Commences Wind-Up Proceedings
-----------------------------------------
Members of Midas NSSG International Pte Ltd, on Feb. 3, 2023,
passed a resolution to voluntarily wind up the company's
operations.
The company's liquidator is:
Tan Eng Soon
c/o 7500A Beach Road
#05-303/304 The Plaza
Singapore 199591
PAN POLY: Members' Final Meeting Set for March 16
-------------------------------------------------
Members of Pan Poly Engineering Pte. Ltd. will hold their final
general meeting on March 16, 2023, at 4:00 p.m., via video
conferencing.
At the meeting, Paresh Tribhovan Jotangia, the company's
liquidators, will give a report on the company's wind-up
proceedings and property disposal.
S&E OFFSHORE: Creditors' Proofs of Debt Due on March 10
-------------------------------------------------------
Creditors of S&E Offshore Investments Pte. Ltd. and S&E Offshore
Investments 2 Pte. Ltd. are required to file their proofs of debt
by March 10, 2023, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on Feb. 1, 2023.
The company's liquidators are:
Aaron Loh Cheng Lee
EY Corporate Advisors Pte Ltd
c/o One Raffles Quay
North Tower 18th Floor
Singapore 048583
TRABBLE PTE: Commences Wind-Up Proceedings
------------------------------------------
Members of Trabble Pte Ltd, on Feb. 1, 2023, passed a resolution to
voluntarily wind up the company's operations.
The company's liquidator is:
Ng Hoe Kiat Keith
7500A Beach Road
#05-303/304 The Plaza
Singapore 199591
[*] SINGAPORE: More Properties Up for Auction as Bankruptcy Rise
----------------------------------------------------------------
ChannelNews Asia reports that more homes in Singapore could be up
for auction this year as the number of bankruptcy petitions rises,
according to real estate consultancy Knight Frank.
This comes amid the higher cost of living, rising interest rates
and the reduction of pandemic support measures, it said in its
latest report on the auctions market on Jan 30.
Ministry of Law data showed that 3,648 people filed for bankruptcy
last year, 15 per cent higher than the 3,160 applications filed in
2021, CNA discloses.
There were 420 auction listings in 2022. This number, which
includes repeat listings, could surge 40 to 50 per cent to about
600 this year, Knight Frank said in its report.
According to CNA, the listings include 184 private residential
properties put up for auction by owners or banks, as well as 211
commercial units including retail shops, offices and industrial
space. There were also 11 shophouses, 12 Housing Board flats and
two properties classified as "others".
Besides more homes being put up for auction, the number of
commercial and industrial properties going on the block could also
increase, the report says. This is as more small- and medium-size
enterprises (SMEs) exit their business amid a gloomy economic
outlook, the Knight Frank report said.
Another real estate consultancy, Edmund Tie, also expects auction
listings to increase but only towards the second half of the year,
as banks will take several months to repossess the units, CNA
notes.
As interest rates continue to rise, those tied to home loans with
floating rates will feel the pinch, said Ms Joy Tan, head of
auction and sales at Edmund Tie.
The three-month compounded Singapore Overnight Rate Average (SORA),
a key benchmark used to price home loans, went up from below 0.2
per cent in January 2022 to more than 3 per cent this year, the
report discloses.
"Those who bought their properties during the property boom year of
2021 on two-year fixed rates will be looking forward to refinancing
this year, and will also feel the pinch with the new rates," CNA
quotes Ms. Tan as saying.
But there are also sellers with strong holding power, she said.
"The healthy rental market helps to alleviate some pressure off the
owners, so there is no urgency as of now for the sellers to dispose
of their investment residential properties."
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2023. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000.
*** End of Transmission ***