OREANDA-NEWS. On 13 March 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine, announced that it assigned a long-term credit rating of uaB to UAH25m 5-year registered coupon bonds to be issued by Lviv Oblast-based Hotelbud LLC (`Issuer` or `company`). The company`s principal activity is investing and construction. Today the company constructs 3 aparthotels in the cities of Truskavets and Lviv. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2006-2007 as well as its other information.

An obligor or a debt liability with uaB credit rating is characterized with the LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is extremely susceptible to adverse changes in commercial, financial and economic conditions.

Factors maintaining the credit rating
The Issuer is incorporated with TKC holding, which operates in development and commercial and residential real estate sectors in Lviv Oblast.
The real estate prices and demand have been growing over the past few yeas in the region.

Factors constraining the credit rating

The size of the bond issue of UAH25m exceeds Issuer`s assets of UAH19.2m and equity of UAH4.3m as of Dec. 31, 2007.

Issuer`s detrimental performance in 2007, in fact its uncovered loss made up UAH0.7m as of Dec. 31, 2007.

The parameters of the issue does not correlate with those typical of interest-bearing bond issuances.

Risks imposed by redistribution of cash flows within the TKC holding neglecting Issuer`s interests, which makes the company vulnerable to exposures of the entire holding.

The TKC`s activities are insufficiently transparent.

Instability in legislation and tax environment controlling both the construction industry and project financing.