OREANDA-NEWS. Fitch Ratings Indonesia has assigned National Ratings to Indonesia-based PT Toyota Astra Financial Services' (TAFS; AAA(idn)/Stable/F1+(idn)) proposed rupiah senior unsecured bonds as follows:

- Bonds with maturity of three years assigned National Long-Term Rating of 'AAA(idn)'; and
- Bonds with maturity of 370 days assigned National Short-Term Rating of 'F1+(idn)'.

The bonds are the third tranche to be issued under TAFS's senior debt programme I of up to IDR4trn, to which Fitch has assigned National Long-Term and Short-Term Ratings of 'AAA(idn)' and 'F1+(idn)', respectively. The issue will be up to IDR1.706trn in size and the proceeds will be used to support the company's business growth.

'AAA' National Ratings denote the highest rating assigned by Fitch on its national rating scale for that country. This rating is assigned to issuers or obligations with the lowest expectation of default risk relative to all other issuers or obligations in the same country.

'F1' National Ratings indicate the strongest capacity for timely payment of financial commitments relative to other issuers or obligations in the same country. On Fitch's National Rating scale, this rating is assigned to the lowest default risk relative to others in the same country. Where the liquidity profile is particularly strong, a "+" is added to the assigned rating.

The bond issues under the programme are rated at the same level as TAFS's National Ratings in accordance with Fitch criteria.
TAFS's ratings reflect its strong support from Toyota Financial Services Corporation (TFSC), one of its two major shareholders. TFSC is a wholly owned subsidiary of Toyota Motor Corporation (TMC; A/Stable), one of the biggest automotive manufacturers in the world. As part of the Toyota group, TAFS benefits from product knowledge and funding support. The latter is derived from TMC's strong relationship with Japanese banks and Japanese government-backed financial institutions.

TAFS also benefits from support from PT Astra International Tbk. (AI), the other major shareholder, particularly in dealership networks. AI is a leading car distributor in Indonesia and holds exclusive rights to sell Toyota vehicles in the country.

Any changes in TAFS's National Ratings would affect the issue ratings.

Any decline in TMC's ownership would exert downward pressure on TAFS's ratings as would a decline in support from both shareholders. However, Fitch sees this prospect as remote in the foreseeable future, given TAFS's strategic role in TMC's and AI's Toyota car financing business.

There is no rating upside for TAFS as it is rated at the top end of the scale.