The Pakistan Credit Rating Agency Limited
Press Release
a

Rating Action
Lahore: (31-January-2007)
    PACRA Maintains the Ratings of
ORIX Leasing Pakistan Limited
 

 
Analyst
Aisha Yasin
(+92-42-586 9504)
aishayasin@pacra.com

 

 

 








 

 

 




 

 

 

 

 

 

Disclaimer
This press release is transmitted to you for this sole purpose of dissemination through your newspaper/magazine/agency. The press release may be used by you in full or in part without changing the meaning or context thereof but with due credit to PACRA. However, PACRA has the sole right of distribution of its press releases for consideration or otherwise through any media.

  

The Pakistan Credit Rating Agency (PACRA) has maintained the long-term and short-term entity ratings of ORIX Leasing Pakistan Limited (OLP) at “AA+” (Double A plus) and “A1+” (A one plus) respectively. The rating of the proposed issue of listed secured Term Finance Certificates of PKR 2,500mln is also maintained at “AA+” (double A plus). These ratings indicate a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments.

The ratings reflect OLP’s low-risk asset profile and sustained market leadership in an increasingly competitive operating environment. The company has an outstanding management team with a demonstrated track record of proactively realigning its strategies with the changing business dynamics. Although OLP’s interest spreads are under pressure, the company has managed the impact on its profitability through volume expansion, while maintaining its cautious approach towards risk. The ratings also recognize the implicit support of ORIX Corporation, Japan as a key factor.

About the TFC Issues: The company is currently in the process of issuing a listed, secured TFC of PKR 2,500mln. The issue will have a tenor of 5 years, carrying profit at the rate of 6-months KIBOR plus 150bps without any floor and cap, payable semi-annually. The principal redemption will be in six equal semi-annual installments beginning 30th month after issuance. OLP will have early repayment option exercisable fully or partially at any redemption date after 1 year of issuance at a 30days notice and without any premium. The issue will be secured by way of registered charge over specific leased assets and associated lease receivables with a 25% security margin.

About the company: ORIX Leasing Pakistan Limited (OLP), the largest leasing company in the country, commenced operations in 1987. The company’s geographical coverage has been steadily increasing over the years, currently comprising 31 offices in 26 cities. OLP has invested in the five leasing joint-ventures of ORIX group within the MENA and central Asian regions, and an investment bank in Pakistan, with participation in management of the investee companies. OLP’s major shareholder, ORIX Corporation, provides technical support and policy guidelines. With a consolidated asset base of over US$ 65bln as at September 30, 2006, ORIX Corporation has operations in 24 countries and regions.
 
The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity.

PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings.

PACRA's opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.

 

    
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