Apr 2015 Financial News

Republic $1b bond issue gets high rating. The RBL Group has maintained comfortable capitalisation levels

Apr 22, 2015

Caribbean Information and Credit Rating Services Ltd (CariCRIS), the Caribbean regional credit rating agency, has reaffirmed the ratings of CariAA+ (Foreign Currency Rating) and CariAA+ (Local Currency Rating) on the regional rating scale, and ttAA+ on the Trinidad and Tobago national scale to the debt issue of $1 billion of Republic Bank Ltd (RBL). 

These ratings indicate that the level of creditworthiness of this obligation, adjudged in relation to other obligations in the Caribbean and within Trinidad and Tobago is high.

The ratings of RBL continue to reflect the bank’s strong market position in Trinidad and Tobago, Barbados, Grenada and Guyana, CariCRIS said in a statement. 

Further supporting the ratings is the healthy resource base marked by a high proportion of retail deposits, geographical diversity and low funding costs, though somewhat tempered by high concentration in the US dollar deposit base. The RBL Group has maintained comfortable capitalisation levels as reflected in good Tangible Net Worth (TNW) coverage of total assets and high capital adequacy ratios. 

In 2014, RBL recorded good profitability measures, albeit at lower levels relative to the prior year, given the challenging regional macroeconomic environment, CariCRIS said. 

“Tempering the ratings is the relatively weak asset quality in two of its subsidiaries, Barbados and Grenada, though at the Group level, asset quality remains comparable to its peers. Loan loss provisioning improved marginally to 40.2 per cent of nonperforming loans in FY2014, but still remains below the domestic average; however, it exceeds 100 per cent if the general contingency reserve account is included.” 

Further, the Group is exposed to downside risks in T&T and other countries due to the decline in oil prices in recent months, the statement added.

Source:
Trinidad Express
Wednesday April 22, 2015

http://www.trinidadexpress.com/business-magazine/Republic-1b-bond-issue-gets-high-rating-300879141.html