PRESS-RELEASE

(Translation from Russian)

RA «Expert-Rating» confirms the rating of bond issues of Series A, B, C of the Company «AUZ Factoring» at the level uaBBB- following the results of 2011

March 15, 2012 the Rating agency «Expert-Rating» confirms the rating of bond issues of Series A, B, C of the Company «AUZ Factoring» at the level uaBBB- according to the national scale. When confirming the credit rating, the Agency was guided by the results of the company’s activity for the 2011.

Table 1

Data on the state of the factoring portfolio of «AUZ Factoring», LLC (th. UAH)

Indicators	2011	2010	Change	Growth rate, %
Total liabilities, excluding bonds	0	0	0	-
Total outstanding bonds of the company to the bondholders	956	13 120	-12 164	-92,71%
The volume of factoring portfolio (face value of the reassigned rights of requirements)	17 390	27 285	-9 895	-36,27%
The volume of financing**	6 686	13 957	-7 271	-52,10%
The volume of financing/ The volume of factoring portfolio ratio	38,45%	51,15%	-12,71p.p.	-
Income received from factoring operations (interest, commissions, etc.)	1 308	2 812,11	-1504,11	-53,49%
Income derived from the portfolio/Volume of financing ratio	19,56%	20,15%	-0,59 p.p.	-
The effective interest rate for the portfolio ***	32%	37,37%	-5,37 p.p.	-
The volume of transactions with payments overdue by more than 1 month	7	1	6	600,00%
Filed for regress	2 600	512,51	2 087,49	407,31%
Other applied sanctions, including judicial proceedings	1 272	-	1272	-

** average amount of financing taking into account the receivables turnover and the set limits

***- the effective interest rate is calculated using the average receivables turnover of 60 days and the average load of portfolio (the financing) for every reporting period

Source: Data of «AUZ Factoring», LLC, calculations by RA «Expert-Rating»

 

When confirming the credit rating, the Agency was based on the following conclusions:

-         In 2011 the market of «classical» factoring has obtained a direct competitor in the form of Ukrainian banks, which have also become interested in this risky segment of financing under conditions of limited financial resource and willing to maximize profits.

-         A number of clients of «AUZ Factoring», LLC have chosen a cheaper banking financing, thus, in 4Q of 2011 the company has worked only with tested clients and with distressed debtors.

-         The company has determined its basic strategy for 2012 – purchase of problem debt at discount and work with management and administration of receivables. Therefore, at the end of December of 2011 the company has performed significant portion of its commitments to bondholders. However, the company intends further to apply this tool in order to attract financing for purchase of problem debts.

Table 2

Payments on bonds of «AUZ Factoring», LLC (th. UAH)

 

Analytical service of RA «Expert-Rating»

Confirmation of «AUZ Factoring», LLC (english version) - 15.03.2012