OREANDA-NEWS. On 25 April 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it assigned a long-term credit rating of uaB+ (uaB plus) to registered housing bonds (series B-E) to be issued by Poltava-based Stroyinvest SM CJSC (`Issuer` or `company`). The amount of the issue is UAH21.8m, with 3 Ѕ-year original maturity. The company`s principal activity is investing and construction. Today the company constructs a residential building located in the city of Sumy. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2006-2007 as well as other inside information furnished by the company.

An obligor or a debt liability with uaB credit rating is characterized with the LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is extremely susceptible to adverse changes in commercial, financial and economic conditions. A plus "+" and a minus "-" signs indicate intermediary categories compared to the standard categories (grades).

Factors maintaining the credit rating

The Issuer is incorporated with the legally informal group of companies, which operate on the construction markets of the cities of Poltava and Sumy, in fact the Issuer has delivered a residential building of 9.3K sq.m., with the 1 st phase of a residential building of 7.5K sq.m. being currently on the completion stage.

The construction of the building located 1/2 Novomestenskaya St., city of Sumy, which premises to redeem the bond issue, has been invested UAH5.8m or over 26% of the project estimated cost.

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

Factors constraining the credit rating

Issuer`s vulnerability to risks of the entire group of companies and to redistribution of cash flows within the group neglecting Issuer`s interests.

Neither the Issuer nor the group`s companies have experience in redemption of housing bonds.

The size of the upcoming issue of UAH21.8m exceeds Issuer`s equity of UAH1.9m accompanied by surety`s (SVF KOLO LLC) equity of UAH0.4m as of Dec. 31, 2007.

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