OREANDA-NEWS. On 12 February 2009 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it assigned a long-term credit rating of uaB- (uaB minus) to registered housing bonds (series A) to be issued by Odessa-based SPS HOLDING LLC ('issuer' or 'company'). The amount of the issue is UAH205.7m due Sep. 29, 2011. The company's principal activity is investing and construction. Today the company constructs a recreational and residential complex located in the city of Zaporizhzhia. In the course of analysis Credit-Rating considered issuers financial statements for 2005-2007 and 9M2008 and its other inside information.

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 company, which is associated with the issuer (SPS-INVEST LLC) has experience in commissioning residential estate property of 4.1K sq.m. total floor area, and in redemption of housing bonds.

The amount of funds invested in construction of the residential complex located at the crossing of Pobedy Str. and Tsentralny Blvrd. in Zaporizhzhia, which premises (77.6% of apartments) to redeem the upcoming bond issue, is UAH26m or 9% of the project's estimated cost, as of Dec. 31, 2008.

Factors constraining the credit rating

Ongoing negative trends in Ukraine's real estate sector, under which the access to funding is curbed.

The unfinished building located at the crossing of Pobedy Str. and Tsentralny Blvrd. in Zaporizhzhia is pledged as security for a bank loan.

The amount of the bond issue of UAH205.7m exceeds greatly the size of issuers assets of UAH23.5 and equity of UAH2.1m as of Sep. 30, 2008.

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