(Repeat for additional subscribers)
May 2 (The following statement was released by the rating agency)
Fitch Ratings has assigned Rizhao Port (Hong Kong) Company Limited's (Rizhao Port) proposed
credit enhanced bonds that are denominated in offshore yuan an expected 'A(EXP)' rating.
Rizhao Port is wholly owned by Rizhao Port Group Co. Ltd. (Rizhao Group). As
part of the bond offering, Rizhao Group has granted a keepwell deed, under which
it will provide liquidity to the issuer when needed to ensure Rizhao Port
remains solvent, functions as a going concern and is able to make timely
payments on the notes..
The final rating is contingent upon the receipt of final documentation and legal
opinions conforming to information already received.
KEY RATING DRIVERS
Irrevocable Standby Letter of Credit: The rating reflects the credit enhancement
that will be provided to investors by the Shandong Branch of Agricultural Bank
of China Limited (ABC; A/Stable). The note is rated at the same level as ABC's
Long-Term Issuer Default Rating (IDR) as ABC is bound by agreements made by its
branches and thus the transaction is considered a senior unsecured obligation of
Investors will have the benefit of an irrevocable standby letter of credit
(SBLC) denominated in Chinese yuan issued by ABC that will expire at 11:59 PM
(Beijing Time) on the maturity date of the proposed bond. The SBLC amount
includes any amount that the issuer has failed to pay into the prefunding
account when required to do so before any payment dates, including at the
maturity of the bonds. In the event of default by the issuer, ABC would be
obligated to the investors for the outstanding principal and interest payable.
Since the rating of the credit enhanced bonds is based solely on ABC's
commitment to meet its obligations under the SBLC to the investors, any change
in Fitch's assessments of ABC's ratings will result in an equivalent change in
the rating of this bond.