OREANDA-NEWS. On 04 April 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it assigned a long-term credit rating of uaBB to registered housing bonds (series A) to be issued by Lviv Oblast-based EKRAN LLC (`Issuer` or `company`). The amount of the issue is UAH109.4m, with 2-year original maturity. Today the company as a customer implements a project of reconstruction of an office building, and constructs a residential building located in the city of Lviv. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2002-2006 and 9M2007 as well as its other inside information.

An obligor or a debt liability with uaBB credit rating is characterized with the LOWER THAN SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is strongly affected by adverse changes in commercial, financial and economic conditions.

Factors maintaining the credit rating

The Issuer has experience in construction of commercial and industrial buildings, in fact as a customer the Issuer has constructed 2 buildings of 9.7K sq.m total floor area and reconstructed 6 buildings of 9.9K sq.m. total floor area.

The Issuer is a primary company in the group, which activities are spread over the western part of Ukraine, and include the following: manufacturing of windows, metal constructions and zincifying of metal items, which empowers the company to diversify its income sources.

The construction readiness of the residential building located 1, Rabotchaya st., Lviv, which premises are to redeem the bond issue, exceeds 10 percent as at 2008 February-beginning.

The real estate prices and demand have been growing over the past few years in the city of Lviv.

Factors constraining the credit rating

The Issuer does not have experience in residential construction, neither in housing bonds redemption.

The size of the upcoming bond issue of UAH109.4m exceeds Issuer`s assets of UAH37m and equity of UAH13.3m as of Sep. 30, 2007.

Instability in legislation and tax environment controlling both the construction industry and project financing.