NRA Lowers Its Credit Rating on Fargo Finance's Series 01 Bonds To ‘C+’, Outlook Negative
OREANDA-NEWS. National Rating Agency has lowered its credit rating on Fargo Finance Ltd's (abbreviated OOO ‘Fargo Finans’ in Russian) Series 01 bonds (Reg. No. 4-01-36433-R, ISIN code: RU000A0JUFK1) to “C+’. The outlook for the rating is Negative. The issue was assigned NRA’s first-time rating on Mar. 5, 2014. The latest rating update was on Sep. 28, 2015.
NRA’s reason for the downgrade is the issuer’s technical default (Fargo Finance Ltd's failure to pay the coupon payment on the Series 01 bond for the 4th coupon period due to the lack of sufficient funds on the issuer’s accounts. The amount paid was more than RUB 269 million short of the amount due. As Fargo Finance Series 01 bonds are secured by guarantees from private company AGELENDRA LIMITED, the coupon payments may be made in the near future. However NRA sees this scenario as unlikely, which factor is reflected in its Negative rating outlook. The outlook may be revised if the issuer fulfils its obligation. If, on the contrary, the obligation is unfulfilled, the negative outlook may translate into a negative rating action.
Founded in Moscow in September 2009, Fargo Finance Ltd specializes in bond issuance for the purpose of financing its commercial property investment projects, carried out in conjunction with business partners. Fargo Finance Ltd's RUB 6 bn Series 01 bond issue was registered by the Central Bank of Russia on Jan. 13, 2014. The issue was offered for public subscription on the Moscow Interbank Currency Exchange (MICE) on Feb. 12, 2014.
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