OREANDA-NEWS. On 30 December 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it downgraded to uaCCC from uaB the long-term credit rating assigned to registered housing bonds (series A-N and O-P) issued by Kiev Oblast-based Regional Construction Investments LLC (`issuer` or `company`). The amount of the issue is UAH100.3m and UAH291.6m respectively to the series stated, due May 15, 2016. The outlook on the rating has been changed to stable. The company`s principal activity is investing and construction. Today the company constructs a residential complex located in the borough of Kotsyubinske, Kiev Oblast. To revise the rating Credit-Rating considered issuer`s financial statements for 3Q and 9M2008 and its other inside information.

An obligor or a debt liability with uaCCC credit rating is characterized with the VERY LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. There is a default possibility.

Stable outlook indicates that there are no anticipated reasons to change the rating in the course of the year.

Factors maintaining the credit rating

The amount of funds invested in construction of a residential building located Ponomareva Str., borough of Kotsyubinske, Kiev Oblast was around UAH307m as of end-3Q2008.

Factors constraining the credit rating

Delays in construction process, which prompted delays in issuer`s meeting its obligations on housing bonds of series A-D, which are to be redeemed with the premises.

The above mentioned residential complex (1st and 2nd phases), which premises to redeem the bonds of series A-P, is pledged as security for bank loans.

The issuer does not have experience in implementation of investment and construction projects, neither in redemption of housing bonds.

Issuer`s detrimental performance during the past few years, in fact the company`s losses in 9M2008 were recorded at UAH(19.5m)

Ongoing negative trends in Ukraine`s real estate sector.

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