OREANDA-NEWS. On 26 December 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it downgraded to uaCCC from uaB+ (uaB plus) the long-term credit rating assigned to registered housing bonds (series A-E) issued by Kiev-Based  Farell Manufacturing Company LLC (`issuer` or `company`). The amount of the issue is UAH43m due Dec. 31, 2008. The rating outlook has been changed to stable. The company`s principal activity is investing and construction. Today the company implements construction projects located in the city of Kiev and city of Boryspil (Kiev Oblast). To revise the rating Credit-Rating considered issuer`s financial statements for 3Q and 9M2008 and its other inside information.

An obligor or a debt liability with uaCCC credit rating is characterized with the VERY LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. There is a default possibility.

Stable outlook indicates that there are no anticipated reasons to change the rating in the course of the year.

Factors maintaining the credit rating

The construction readiness of the residential buildings located 42, Gorkogo Str. and 97, Vatutina Str., city of Boryspil, which premises to redeem the bonds of series A and B, is 98.5% and 72% respectively (as of Sep. 30, 2008).

Factors constraining the credit rating

The issuer does not have experience in redemption of housing bonds.

The construction works at the residential building located 97, Vatutina Str., city of Boryspil, which premises to redeem the bonds of series B, are suspended.

Poor issuer`s performance indicators recorded over the past few years.

Ongoing negative trends in Ukraine`s real estate sector.

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