Fitch Rates PT BCA Finance's Senior Bond 'AAA(idn)'

Thu Feb 13, 2014 10:59pm EST

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(The following statement was released by the rating agency) JAKARTA/TAIPEI/SINGAPORE, February 13 (Fitch) Fitch Ratings has assigned ratings to Indonesia-based PT BCA Finance's (BCAF; AAA(ind)/Stable) proposed rupiah senior unsecured bonds as follows: - Bonds with maturity of three and four years assigned National Long-Term (LT) Rating of 'AAA(idn)'; and - Bond with maturity of 370 days assigned National Short-Term (ST) Rating of 'F1+(idn)'. The bond issue will be up to IDR500bn in size and the proceeds will be used to support the company's business growth. It is the third tranche to be issued this year under the company's bond programme I. 'AAA' National Ratings denote the highest rating assigned by Fitch on its national rating scale for that country. This rating is assigned to issuers or obligations with the lowest expectation of default risk relative to all other issuers or obligations in the same country. 'F1' National Ratings indicate the strongest capacity for timely payment of financial commitments relative to other issuers or obligations in the same country. On Fitch's National Rating scale, this rating is assigned to the lowest default risk relative to others in the same country. Where the liquidity profile is particularly strong, a "+" is added to the assigned rating. KEY RATING DRIVERS The bonds are rated at the same level as BCAF's National LT and ST Ratings as they constitute direct, unsubordinated and senior unsecured obligations of the company and rank equally with all other unsecured and unsubordinated obligations. BCAF's ratings reflect Fitch's expectation of a high propensity of support from parent, PT Bank Central Asia Tbk (BCA), in times of need. The ratings also take into account BCAF's importance to its parent as a core subsidiary to support BCA's business expansion in Indonesia's consumer financing market. As an integral part of BCA's consumer business chain, BCAF has an important role in managing BCA's entire portfolio of vehicle loans. BCA's support is manifested in the common brand name it shares with BCAF, the provision of funding and operational alignment. Fitch expects that BCA will continue to support BCAF in case of need. RATING SENSITIVITIES Any changes in the company's National LT and ST Ratings would affect these issue ratings. Any significant decline in BCA's ownership and performance or support and BCAF's contribution to BCA would exert downward pressure on BCAF's ratings. However, Fitch sees this prospect as remote in the foreseeable future, given BCAF's importance as a core subsidiary to BCA in expanding consumer financing business. There is no rating upside as the rating is at the top of the scale. Contacts: Primary Analyst Julita Wikana Director PT Fitch Ratings Indonesia Financial Institution DBS Bank Tower 24th Floor, Suite 2403 Jl. Prof. Dr. Satrio Kav 3-5 Jakarta, Indonesia 12940 +62 21 2988 6808 Secondary Analyst Iwan Wisaksana Director +62 21 2988 6807 Committee Chairperson Jonathan Lee Senior Director +886 2 8175 7601 Media Relations: Leslie Tan, Singapore, Tel: +65 67 96 7234, Email: leslie.tan@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(idn)' for National ratings in Indonesia. Specific letter grades are not therefore internationally comparable. Additional information is available at www.fitchratings.com. Applicable criteria, "Global Financial Institutions Rating Criteria", dated 31 January 2014, "Finance and Leasing Companies Ratings Criteria", dated 12 December 2012, "Rating FI Subsidiaries and Holding Companies", dated 10 August 2012, and "National Scale Ratings Criteria", dated 30 October 2013, are available at www.fitchratings.com. Applicable Criteria and Related Research: Global Financial Institutions Rating Criteria here Finance and Leasing Companies Criteria here National Scale Ratings Criteria here Rating FI Subsidiaries and Holding Companies here Additional Disclosure Solicitation Status here ALL 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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