Expected credit rating rationale. The issue represents senior unsecured debt of Home Credit and Finance Bank, LLC (hereinafter, the Bank). Due to the absence of either structural or contractual subordination of the issue, ACRA regards it as equal to other existing and future unsecured and unsubordinated debt obligations of the Bank in terms of priority. According to ACRA's methodology, the credit rating of the issue is equivalent to that of the Bank, i.e. eA(RU).
The credit rating of the Bank is based on the Bank’s moderate business profile, strong capital adequacy position, adequate risk profile, and adequate liquidity and funding position. The volatility of asset quality and profit indicators due to the Bank’s business model, as well as the significant concentration of funding on consumer funds, limit the Bank’s standalone creditworthiness assessment. The rating is supported by the high probability of shareholder support.
Key issue properties
| Issuer | Home Credit and Finance Bank, LLC |
| Issuer’s credit rating | A(RU), outlook Stable |
| Actual issuer | Home Credit and Finance Bank, LLC |
| Type of security | Exchange-traded interest-bearing |
| Type of debt | Senior unsecured |
| Issue volume | RUB 5 bln |
| Proposed placement date | February 2021 |
| Expected time to maturity | 5 years |
| Put option date | 3 years later |
Regulatory disclosure
ACRA will assign a credit rating to BO-07 series bond after the final documentation is presented by Home Credit and Finance Bank, LLC. In case of any significant discrepancies between the final documentation and the preliminary materials, ACRA may change the issue credit rating against the expected credit rating.
The expected credit rating has been assigned under the national scale for the Russian Federation based on the Methodology for Assigning Credit Ratings to Individual Issues of Financial Instruments under the National Scale of the Russian Federation, and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities.
The expected credit rating has been assigned to BO-07 series bond issued by Home Credit and Finance Bank, LLC for the first time. ACRA expects to assign the final credit rating within 90 days following the publication date of this press release.
The expected credit rating is based on the data provided by Home Credit and Finance Bank, LLC, information from publicly available sources, and ACRA’s own databases. The expected credit rating is solicited, and Home Credit and Finance Bank, LLC participated in its assignment.
No material discrepancies between the provided information and the data officially disclosed by Home Credit and Finance Bank, LLC in its financial statements have been discovered.
ACRA provided no additional services to Home Credit and Finance Bank, LLC. No conflicts of interest were discovered in the course of the expected credit rating assignment.
