December 29, 2011 The rating agency «Expert-Rating» confirms the rating of bond issues of Series A, B and 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 activity for the 9 months of 2011.
Table 1
Data on the factoring portfolio state of «AUZ Factoring», LLC (th. UAH)
Indicators | 9 months of 2011 (01.10.2011) | 9 months of 2010 (01.10.2010) | Change | Growth rate |
Total liabilities of the company, excluding bonds | 0 | 0 | - | - |
Total outstanding bonds of the company to the bondholders | 8 505,0 | 10 000,00 | 0,85 | -14,95% |
The volume of factoring portfolio (face value of the reassigned rights of requirements) | 22 181,00 | 24 080,00 | 0,92 | -7,88% |
The amount of the granted funding** | 4 244,4 | 12 296,4 | 0,34 | -65,48% |
The amount of the granted funding/ The volume of factoring portfolio ratio | 19,14% | 51,06% | 0,37 | -62,51% |
Income received from factoring transactions (interest, commissions, etc.) | 1 274,64 | 1 260,30 | 1,01 | 1,13% |
Income derived from the portfolio/ The amount of granted funding ratio | 5,16% | 5,23% | 0,98 | -1,33% |
The effective interest rate for the portfolio*** | 31% | 35% | 0,88 | -11,43% |
The volume of transactions with payments overdue by more than 1 month | 0 | 0 | - | - |
Filed for regress | 1 098,00 | 250,00 | 4,39 | 339% |
Other sanctions are applied, including judicial proceedings | 250,00 | - | - | - |
** average amount of granted funding 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 granted funding) 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:
1. The market of factoring services depends on the situation of the banking sector. That’s why, there have been several important structural changes for the 9 months of 2011, which had a significant impact on the players of the factoring services market. Firstly, there was deterioration in the banking sector, namely, the banks liquidity indicators sharply deteriorated and as a result, secondly, there was a sharp increase in interest rates of short-term deposits. Therefore, the banks have started to actively engage clients under the schemes of factoring, based on the rapid turnover of resources and opportunities to maximize their profits.
2. A number of clients of «AUZ Factoring», LLC have chosen the banking funding instead of the funding of the factoring company. Therefore, the amount of granted funding has considerably decreased. At the same time, the shareholders of «AUZ Factoring», LLC have made a decision to work till the end of 2011 only with those clients, which already were in the portfolio and with which the company had a history of interaction.
3. The deterioration of the financial market conditions didn’t affect the solvency of «AUZ Factoring», LLC and the company performed in time their liabilities to the bondholders for the period from January 01 to September 30 of 2011:
Table 2
Payments on bonds of «AUZ Factoring», LLC (th. UAH)
Indicators | Series А | Series B | Series С |
January of 2011 | 558.54 | | |
March of 2011 | | 218.23 | |
April of 2011 | 483.74 | | |
May of 2011 | | | 141.78 |
June of 2011 | | 492.22 | |
July of 2011 | 502.87 | | |
September of 2011 | | 301.80 | |
Total | 1,545.15 | 1,012.25 | 141.78 |
Analytical department of RA «Expert-Rating»
Full confirmation of the rating of bond issues of Series A, B and C of the Company «AUZ Factoring» (english version) - 29.12.2011