Fitch Ratings-Jakarta-07 February 2017: Fitch Ratings Indonesia has assigned National Ratings to PT BFI Finance Indonesia Tbk's (BFI, AA-(idn)/Stable) proposed rupiah senior unsecured bonds (Obligasi Berkelanjutan III BFI Finance Indonesia Tahap II Tahun 2017) as follows:
BFI's proposed bond issuance, the second tranche under the existing senior unsecured bond programme III, will be up to IDR1trn in size. The proceeds from the issuance will be used for working capital purposes.
'AA' National Ratings denote expectations of very low default risk relative to other issuers or obligations in the same country. The default risk inherently differs slightly from that of the country's highest rated issuers or obligations.
KEY RATING DRIVERS
The bonds are rated at the same level as BFI's National Long-Term Rating in accordance with Fitch criteria.
BFI's National Ratings are driven by its strong standalone profile as one of the largest independent finance companies in Indonesia with core competence in used-car and motorcycle refinancing. Its ratings also reflect its above-industry-average profitability, strong capitalisation, diversified funding sources and resilient asset quality.
Any changes to the National Ratings would affect the issue ratings.
A significant weakening of asset quality that could adversely impact profitability and capitalisation may exert downward pressure on BFI's National Ratings. Sustainable growth that results in significantly higher market share, while maintaining solid asset quality, may lead to a rating upgrade, although Fitch views this scenario as unlikely in the near to medium term.
Date of Relevant Rating Committee: 24 November 2016
Note to editors: Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. The best risk within a country is rated 'AAA' and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(idn)' for National ratings in Indonesia. Specific letter grades are not therefore internationally comparable.
Additional information is available at www.fitchratings.com
Global Non-Bank Financial Institutions Rating Criteria (pub. 15 Jul 2016)
National Scale Ratings Criteria (pub. 30 Oct 2013)
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