Fitch rates Asakabank’s UZS-Denominated Debut Eurobonds ‘BB-(EXP)’
Tashkent, Uzbekistan (UzDaily.com) -- Fitch Ratings has assigned Joint-Stock Company Asakabank’s upcoming issue of Uzbekistan som-denominated senior unsecured Eurobonds an expected long-term rating of ‘BB-(EXP)’.
The issue will be in Uzbekistan som, but all settlements will be in US dollars using the exchange rate determined as an average market rate at each settlement date. The maturity of the issue will be three years, while the size and the coupon are yet to be determined. Asakabank plans to use the proceeds to finance its local-currency lending portfolio.
The final rating is contingent upon the receipt of final documents conforming to information already received.
The expected rating is in line with Asakabank’s Long-Term Foreign-Currency Issuer Default Rating (IDR) of ‘BB-’, as all settlements will be in US dollars. The notes will represent direct, unconditional and senior unsecured obligations of the bank, which rank pari passu with its other senior unsecured obligations.
Asakabank’s IDRs reflect Fitch’s view of a moderate probability of support from the government of Uzbekistan (BB-/Stable). This view is based on Asaka’s majority state ownership, significant systemic importance, the low cost of support relative to sovereign international reserves and a record of capital and liquidity support.
The bond draft documentation includes a change-of-control clause, under which bondholders will have an option to redeem the notes at 101% of principal amount if the state ceases to control the bank directly and indirectly (i.e. the share of the state declines below 50% +1 share).