Tris Rating has assigned a AAA rating on Yoma Strategic Holdings's (YSH) 2.3 billion baht of guaranteed bonds due within five years.
The bonds are guaranteed by Credit Guarantee and Investment Facility (CGIF), (AAA/stable), a trust fund of the Asian Development Bank (ADB), and the AAA rating reflects the creditworthiness of CGIF as the guarantor of the bonds.
CGIF will provide an unconditional guarantee to cover 100% of the principal and interest payments for the guaranteed bonds, and the guarantee obligations rank equally with all other present and future unsecured and unsubordinated indebtedness of the CGIF.
The bondholders might not receive payment in baht if CGIF determines it is impossible or impracticable, and that reasonable efforts have been made to obtain baht. In such an event, CGIF may make an equivalent payment in US dollars or other currencies. However, Tris views the likelihood of such risk as very low.
The rating and outlook may change if the rating of its guarantor CGIF changes.
YSH was listed on the mainboard of the Singapore Exchange in 2006. At first a real estate developer, the company expanded through joint ventures and strategic partnerships into a diversified conglomerate in Myanmar.
As of March 2018, YSH's business includes consumer, automotive and heavy equipment, and financial services businesses, which contribute around 60% of its revenue. Since 2014, YSH has set its strategic focus to dominate its position in these sectors.
CGIF was founded in 2010 under an initiative of the 10 Asean countries, together with China, Japan, South Korea and the ADB, with the objective of providing credit guarantees to allow eligible issuers to access regional local currency bond markets. Issuers can avoid currency and maturity mismatches by issuing bonds within the region.
ADB is the trustee of CGIF. It holds all of CGIF's capital and is responsible for managing it.
