May 28, 2015 / 7:13 AM / 2 years ago

Fitch Places Asia Plus on Rating Watch Evolving

(The following statement was released by the rating agency) BANGKOK/HONG KONG, May 28 (Fitch) Fitch Ratings (Thailand) has today placed Asia Plus Group Holdings Securities Public Company Limited 's (ASP) National Long-Term Rating of 'A-(tha)' and National Short-Term Rating of 'F2(tha)' on Rating Watch Evolving (RWE). A full list of rating actions is at the end of this commentary. The rating action follows ASP's recent group restructuring on 1 May 2015. KEY RATING DRIVERS The RWE reflects the potential changes in ASP's business model, capital structures and risk appetites on a stand-alone basis following the restructuring of the company's group holding structure. The former Asia Plus Securities Public Company Limited has been renamed Asia Plus Group Holdings Securities Public Company Limited and becomes the holding company of the group. A new entity, Asia Plus Securities Limited (ASPS), has been set up to operate ASP's securities brokerage and related business. At the same time, ASP has continued to operate the proprietary trading and private equity business and has direct full ownership in ASPS and the other two existing subsidiaries - Asia Plus Advisory Co., Ltd and Asset Plus Fund Management Co., Ltd. While there should be no material change to the consolidated financial profile of ASP, Fitch would need to assess ASP on a stand-alone basis as a holding company. RATING SENSITIVITIES Fitch expects to resolve the RWE after Fitch is able to assess ASP's and ASPS's actual financial profile and outlook after the interim financial statements at end-1H14 are made available and after the agency is able to discuss with the company's management about potential changes on the company's strategies, capital structures and risk appetites. Fitch expects to resolve the RWE within 3Q15. The potential for positive rating action is limited as the restructuring is unlikely to materially improve ASP's credit fundamentals. A negative rating action is possible if ASP's leverage significantly increases or if the company demonstrates a material increase in risk appetites. ASPS, the core operating entity of ASP, is the 10th-largest securities company in Thailand by traded securities volume in 2014, with 3.8% market share. The company has a fairly strong domestic franchise and is one of a few securities companies without strong shareholding links with banks or foreign institutions that has a decent market share and market presence. The rating actions are as follows: Long-Term National Rating of 'A-(tha)' placed on RWE Short-Term National Rating of 'F2(tha)' placed on RWE Contact: Primary Analyst Trin Siriwutiset Associate Director +662 108 0154 Fitch Ratings (Thailand) Limited Park Ventures, Level 17 57 Wireless Road, Lumpini Patumwan, Bangkok 10330 Secondary Analyst Parson Singha Senior Director +662 108 0151 Committee Chairperson Jonathan Lee Senior Director +886 2 8175 7601 Media Relations: Leslie Tan, Singapore, Tel: +65 67 96 7234, Email: leslie.tan@fitchratings.com. Note to Editors: Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. The best risk within a country is rated 'AAA' and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(tha)' for National ratings in Thailand. Specific letter grades are not therefore internationally comparable. Additional information is available on www.fitchratings.com Applicable Criteria Global Non-Bank Financial Institutions Rating Criteria (pub. 28 Apr 2015) here Additional Disclosures Solicitation Status here <a href="https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context =2&detail=31">Endorsement Policy ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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