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Moody's assigns Ba2 to PrivatBank's (Ukraine) senior unsecured notes

January 18, 2007 | Cbonds

Moscow, January 18, 2007 -- Moody's Investors Service has assigned a rating of Ba2 to the guaranteed notes to be issued on a limited recourse basis by UK SPV Credit Finance PLC, an orphan SPV, and unconditionally and irrevocably guaranteed by Closed Joint-Stock Company Commercial Bank PrivatBank (PrivatBank). The proceeds will be used for the sole purpose of funding a loan to PrivatBank. The outlook for the rating is stable.

The holders of the notes will be relying for repayment solely and exclusively on the ability of PrivatBank to make payments under the loan agreement. Moody's Ba2 rating is based on the fundamental credit quality of PrivatBank. The rating of the notes has pierced Ukraine's Ba3 (positive outlook) foreign currency sovereign ceiling for bonds.

PrivatBank's obligations under the loan agreement and the guarantee will rank at all times at least pari-passu with the claims of all other unsecured and unsubordinated creditors of the bank, save for those claims that are preferred by any relevant law. The terms and conditions of the notes contain a negative pledge clause and a cross-acceleration clause, covenants that limit mergers, disposals and transactions with affiliates.

According to Moody's, the notes might be eligible for early redemption by the noteholders if the bank's ratings were to be downgraded in the event that the current shareholders (three prominent Ukrainian businessmen, controlling a number of industrial assets) cease to own more than a 50% stake of the bank.

Company: PrivatBank

Full company namePrivatBank PJSC
Country of riskUkraine
Country of registrationUkraine
IndustryBanks

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