DATA PLATFORM FOR FINANCIAL MARKET PROFESSIONALS AND INVESTORS
  • High performance interface for global bond market screening
  • Full information on close to 400,000 bonds from 180 countries
  • 100% coverage of Eurobonds worldwide
  • Over 300 primary sources of prices
  • Ratings data from all international and local ratings agencies
  • Stock market data from 60 world trading floors
  • Intuitive, high speed user interface
  • Data access via the website, mobile application and add-in for Microsoft Excel

Moody's assigns B1 to Renaissance Kaznachei's senior secured debt (Russia)

October 22, 2010 Moody's Investors Service
Moscow, October 21, 2010 -- Moody's Investors Services has today assigned
a B1 long-term global local currency debt rating to senior secured debt
of Renaissance Kaznachei, which benefits from an explicit and irrevocable
guarantee issued by Renaissance Financial Holding Limited (RFHL, rated
B1/Not Prime). The rating carries a stable outlook. Any subsequent local
currency senior secured debt issuance by Renaissance Kaznachei will be
rated at the same level subject to there being no material change in
RFHL's overall credit rating and/or in the terms and conditions of this
new debt issuance.

The rating of B1 was assigned to the following debt instruments:

The rouble bond programme which will facilitate the following issuances:

- RUB3.000 billion senior bond due in five years

- RUB4.000 billion senior bond due in five years

- RUB5.000 billion senior bond due in five years

- a first drawdown due 2015

RATINGS RATIONALE

The assigned rating is in line with RFHL's global local currency issuer
rating of B1. It does not incorporate any expectation of systemic or
shareholder support for RFHL in case of need.

Moody's notes that the rating is constrained by (i) risky and unstable
markets where the Renaissance group operates, aggravated by concentration
of revenues on a limited number of products and lack of geographical
diversification; (ii) diminished competitive power as markets are
re-shaped; (iii) significant appetite for market and credit risks in long
term strategic positions; (iv) sizeable "cliff risk" in terms of
liquidity if major market dislocation occurs; and (v) a complex
organisational structure consisting of a large number of individual
entities, which could result in some structural subordination from
operating entities and exposure to various legal risks, while poor
regulation of Russian securities markets may fail to limit and control
industry-related and company-specific risks -- albeit significantly
mitigated by the fact that more than 50% of business is booked under EU
Regulations.

At the same time, Moody's observes that the rating is supported by (i)
its solid position in the Commonwealth of Independent States (CIS)
investment banking market; (ii) the relatively low risk appetite for
short term market and credit risks assumed in the company's day-to-day
activities; (iii) relatively low leverage which is beneficial for
liquidity (which is currently adequate and is capable of withstanding
medium-sized shock), and its capital cushion is sufficiently adequate to
accommodate credit and market risks; and (iv) the ability -- as
historically demonstrated by the management (shareholder) team -- to
quickly adjust to new business realities and anticipate challenges in the
operating environment.

The principal methodology used in rating Renaissance Kaznachei was Global
Securities Industry Methodology rating methodology published in December
2006. Other methodologies and factors that may have been considered in
the process of rating this issuer can also be found on Moody's website.

RFHL reported total (audited) consolidated assets of USD3.2 billion,
total equity of USD1.1 billion at year-end 2009 and net profit of USD12
million.

  • Registration country
    Russia
  • Industry
    Financial institutions