GCR Assigns Rating to Coronation Merchant Bank SPV N15bn Notes
GCR Ratings has assigned a national scale long term indicative issue rating of A-(NG) (IR) to Coronation Merchant Bank Alternative Asset SPV Plc.’s proposed N15 billion Series 1 Senior Secured Guaranteed Notes, with a stable outlook.
A statement issued by GCR reads that Coronation MB Alternative Asset SPV Plc is a special purpose vehicle incorporated as a business finance company solely for the purpose of raising finances through the securitization of loan receivables for the purposes as may be approved of by its board of directors from time to time, the ratings agency said.
Specifically, it noted that the purpose of the N15 billion Series 1 Senior Secured Guaranteed Notes is to finance the purchase of loan receivables from Coronation Merchant Bank Limited through the issuance of securitized security to the general public.
“The Issuer is in the process of filing an application with the Securities and Exchange Commission to issue Notes into the Nigerian capital market under a N50 billion Medium-Term Asset Backed Securitized Note Issuance Programme”, it added.
GCR hinted that the programme is backed by a resolution of the board of the Issuer, which authorises the Issuer to issue Notes in several separate Series or Tranches from time to time, with varying maturities and variable rates of interests.
An initial N15 billion is proposed to be issued in Series 1 Senior Secured Guaranteed Fixed Rate Notes under the Programme, the statement reads.
The emerging-market focus ratings from said the Series 1 Notes shall constitute senior, secured, unsubordinated, unconditional, and irrevocable obligations of the Issuer and shall at all times rank pari passu without preference with other obligations of the Issuer and the Guarantor.
The Guarantor, Coronation MB, has agreed to provide an irrevocable and unconditional guarantee in favour of the Guarantee Trustee for and on behalf of the Series 1 Noteholders to guarantee the timely performance of the obligations of the Issuer under the Series 1 Note Issue, it said.
GCR said payment obligations of the Issuer in respect of the Notes, and that of the Guarantor under a Deed of Guarantee shall, save for such exceptions as may be provided by Applicable Law, at all times rank at least pari passu with all other senior unsecured indebtedness of the Issuer and the Guarantor, both present and future.
Accordingly, the Guarantor and the Guarantee Trustees are entering into a guarantee agreement pursuant to which Coronation MB, in its capacity as the Guarantor, shall guarantee the timely payment of all principal repayment and coupon payments regarding the Series 1 Notes, in line with the terms and conditions of the Deed of Guarantee.
It added that the legal opinion provided to GCR indicates that the Guarantee and other conditions stipulated in the transaction documents constitute legal, valid, binding and enforceable obligations of the Guarantor. # GCR Assigns Rating to Coronation Merchant Bank SPV N15bn Notes
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