June 26, 2014 / 7:01 AM / in 4 years

RPT-Fitch Rating Senior Bonds and Subordinated Bank of North Sulawesi

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June 26 (Reuters) - (The following statement was released by the rating agency)

Fitch Ratings has set ranks of senior bond plan and PT Bank subordinated bonds Flammable as follows:

- National Long-Term rating at ‘A (idn)’ to the senior bonds with period of up to five years is set; and

- National Long-Term rating at ‘BBB-(idn)’ to bond subrodinasi with a term of up to seven years.

Issuance of senior bonds amounting to a maximum of 750 billion dollars and bonds subordination for a maximum of 250 billion dollars. Proceeds from this bond will be used to support the business growth of the company. A (idn)

National ranking in the category ‘A’ indicates the expectation would risk failure low pay relative to other issuers or securities in Indonesia. However, a change in circumstances or economic conditions may be affect the capacity to pay in a timely manner than commitment Financial shown by the higher rating categories. BBB (idn)

National ranking in the category of ‘BBB’ denotes the expectation would be the risk of failure Pay is moderate relative to other issuers or securities in Indonesia. However, the possibility of changes in circumstances or economic conditions will affect the capacity to pay in a timely manner is greater compared the financial commitment shown by rank category higher ..


Senior bonds rated at the same level with the National Rating Long-term debt due to the Bank of North Sulawesi reflects liability company that is direct, not a subordinated debt and are senior unsecured obligations and liabilities equivalent to all senior unsecured and other debts.

Subordinated bonds rated three notches below the anchor ranked Bank North Sulawesi, which is based on the bank’s standalone credit profile and do not take into account the possibility of government support - one notch to loss severity (reflecting features of complementary capital conversion to ordinary shares or write down) and two notches for the risk of non-performance (reflecting subordinated status and the risk of delay in payment of principal and / or interest). debt

This is a subordinated obligation that is direct, tersubrodinasi, not guaranteed and rated the same as the other subrodinasi debt obligations. Bank of North Sulawesi rating reflects Fitch’s view that the government of North Sulawesi have a tendency to give ekstraordinari support to banks, if necessary, given the government majority ownership over Bank of North Sulawesi. The rating also takes into account the potential, although limited, given the support of the central government’s important role Bank of North Sulawesi eknonomi in supporting regional development in North Sulawesi and functions of banks as treasurer for the local government of North Sulawesi and Gorontal, and as bank loans as the main distributor for local government officials.


Changes at National Bank will have an impact on the North Sulawesi debt. Pressure drop in ranking can happen if there is an attenuation ability and / or propensity to provide support for the central government ekstraordinari to Bank North Sulawesi. However, Fitch believes that this will not happen in the near to medium term. The drop on standalone financial profile Bank Sulut less likely to influence their national level, given the majority ownership of the majority of local governments and potential support Bank of North Sulawesi.

Potential increase in the National Bank of North Sulawesi ratings may occur when the difference Bank of North Sulawesi circuitry other major banks in Indonesia in asset size and much smaller operation, also the ability to maintain asset quality good, high core capital position and with adequate profitabilias low-cost funds are more dominant. Indonesia’s sovereign rating upgrade potential to affect the bank’s ratings.

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