Fitch Rates City of Plock's Bonds 'BBB'/'A+(pol)'

Tue Jan 21, 2014 10:03am EST

WARSAW/PARIS/LONDON, January 21 (Fitch) Fitch Ratings has assigned the City of Plock's issue of PLN86.85m senior unsecured bonds maturing in 2021 to 2025 Local Currency Long-term ratings of 'BBB' and National Long-term ratings of ‘A+(pol)’. KEY RATING DRIVERS The ratings on the senior unsecured bonds are in line with the city's Local Currency Long-term Issuer Default Rating (IDR) and National Long-term rating as they rank pari passu with all previous and future obligations of the issuer. Fitch affirmed the City of Plock’s foreign and local currency Issuer Default Ratings at ‘BBB’ and its Long-term National rating at 'A+(pol)' with Stable Outlooks on 17 December 2013. The new bonds were issued for early repayment of PLN86.85m of outstanding debt to take advantage of better market conditions and to improve Plock’s debt maturity profile. The new bonds have a floating coupon rate based on six month WIBOR plus margin to 0.88% from 0.64% annually. The interest coupons on the issue will be paid semi-annually starting from June 2014. The City of Plock is located in the Mazowieckie Region, the wealthiest Polish region. The city’s economy is dominated by the petrochemical sector with the presence of PKN Orlen - the leading Polish refining and marketing oil company and one of the largest in central Europe. The presence of its headquarters and main refinery in Plock ensures high and constantly growing property tax revenue. However, this also leads to volatile corporate income tax revenue within the city’s budget. RATING SENSITIVITIES Changes to the city’s ratings and/or Outlooks may affect its senior unsecured debt ratings. Contact: Primary Analyst Dorota Dziedzic Director +48 22 338 62 96 Fitch Polska S.A. 16 Krolewska Street, Warsaw 00-103 Secondary Analyst Renata Dobrzynska Director +48 22 338 62 82 Committee Chairperson Christophe Parisot Managing Director +33 1 44 29 91 34 Media Relations: Peter Fitzpatrick, London, Tel: +44 20 3530 1103, Email: peter.fitzpatrick@fitchratings.com; Malgorzata Socharska, Warsaw, Tel: +48 22 338 62 81, Email: Malgorzata.Socharska@Fitchratings.com. Additional information is available on www.fitchratings.com Applicable criteria, 'Tax-Supported Rating Criteria' dated 14 August 2012 and 'International Local and Regional Governments Rating Criteria outside United States' dated 9 April 2013 are available at www.fitchratings.com Note to Editors: Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. The best risk within a country is rated 'AAA' and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(pol)' for National ratings in Poland. Specific letter grades are not therefore internationally comparable. Applicable Criteria andALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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