Bangkok--18 Jul--Fitch Ratings (Thailand)
Fitch Ratings (Thailand) Limited today assigned an expected National Long-term rating of ‘AAA(tha)’ to SICCO Special Purpose Vehicle 2 Company Limited’s (“SICCO SPV 2”) upcoming up to THB3.0 billion issue of debentures (“the debentures”). The expected rating addresses timely payment of interest and ultimate repayment of principal by the legal final maturity in February 2013. Provided an early amortisation or an event of default does not occur, full principal repayment should be completed by the expected maturity date in February 2011. The rating, however, does not take into account the probability of early amortisation.
This transaction is the second securitisation transaction of auto hire purchase receivables originated by Siam Industrial Credit Public Company Limited (“SICCO”), a Thai finance company. On the closing date, SICCO will sell eligible receivables to the issuer on a 1.5-year revolving basis followed by a controlled amortisation period. The purchase of receivables will be 77.5% funded by the issuance of debentures and the payment of the remainder 22.5% will be deferred as credit enhancement.
Fitch’s expected rating is based on the subordination of 22.5% available for credit loss protection, commingling risk, set-off risk and yield enhancement. It also reflects the quality of the underlying pool of receivables (which includes only new vehicle financing), the eligibility criteria imposed to protect investors from significant deterioration in the portfolio owing to its initial revolving nature, various early amortisation trigger events to protect investors against any severe deterioration in the portfolio and insolvency risks affecting the originator or servicer. The expected rating takes into account SICCO’s originating and servicing capabilities and the appointment of Hongkong and Shanghai Banking Corporation Limited (rated ‘AA’/’F1+’ on the international scale) as back-up servicer, as well as the sound financial and legal structures of the transaction.
SICCO SPV 2, a special-purpose company with limited liability established under Thai law, is expected to be granted special-purpose vehicle status under the Securitisation Law. The purchased assets shall have a value of up to approximately THB3.9bn at the proposed initial cut-off date, 31 July 2006.
The rating is contingent upon receipt of final documents including legal opinions and signed agreements conforming to information already received and SEC approval of the securitisation programme.
A copy of the presale report will be available on the agency’s web site, www.fitchratings.com and Fitch’s Asian website www.fitchratingsasia.com
Contact: Orawan Karoonkornsakul, Napachak Phasukavanich, Vincent Milton; Bangkok, Tel: +662 655 4755; Stan Ho, Hong Kong, +852 2263 9668