Reuters logo
Fitch Affirms Thailand's Asia Plus, Finansia Syrus and Finansa
July 21, 2017 / 8:30 AM / 5 months ago

Fitch Affirms Thailand's Asia Plus, Finansia Syrus and Finansa

(The following statement was released by the rating agency) BANGKOK, July 21 (Fitch) Fitch Ratings (Thailand) has affirmed the National Ratings of Asia Plus Group Holdings Public Company Limited (ASP), Finansia Syrus Securities Public Company Limited (FSS) and Finansa Public Company Limited (FNS) as follows: - ASP's National Long-Term Rating affirmed at 'A-(tha)' with a Stable Outlook and National Short-Term Rating affirmed at 'F2(tha)'. - FSS's National Long-Term Rating affirmed at 'BBB+(tha)' with a Stable Outlook and National Short-Term Rating affirmed at 'F2(tha)'. - FNS's National Long-Term Rating affirmed at 'BBB-(tha)' with a Stable Outlook and National Short-Term Rating affirmed at 'F3(tha)'. KEY RATING DRIVERS ASP's National Ratings reflect its robust domestic securities franchise, which the group operates through its key operating subsidiary, Asia Plus Securities (ASPS). Fitch assesses the group on a consolidated basis due to ASPS's large size relative to the group as well as the high level of integration between ASP and ASPS, operationally and financially. ASPS is among the stronger and more diversified securities firms in Thailand, with a large brokerage presence among retail investors as well as significant footprints in capital markets and investment banking. Fitch expects ASP to maintain sound financials and navigate profitability pressure more successfully than its domestic peers. Its brokerage margins are likely to continue to outperform the industry average due to its well-established client relationships. The agency believes ASP's revenue has the potential to become further diversified as it expands its presence in wealth management and other non-brokerage businesses. Its leverage has remained low, with equity-to-assets ratios mostly above 50% over the past several years. The affirmation of FSS's National Ratings reflects its moderate business franchise, sound capitalisation, manageable risk appetite, and adequate funding and liquidity. FSS remains a strong player with 5.4% market share by trading value, ranking fourth among securities firms in Thailand at end-1H17, but its brokerage commission fees have been declining in tandem with industry trends amid stiff price competition. Fitch believes FSS's profitability continues to be constrained by lower brokerage margins and higher expenses from its infrastructure development. However, the company's sound capitalisation, reflected in an equity-to-assets ratio of 48.4% at end-1Q17, and adequate liquidity position should provide sufficient buffer against short-term business shocks. The agency views that FSS's risk controls are acceptable and the risk profile of its assets has been stable. The affirmation of FNS's National Ratings reflects its standalone financial strength, which takes into account its small domestic franchise, volatile profitability as well as acceptable capital and liquidity position. FNS's recent investments in the warehouse and factory rental business will help stabilise its income stream, while profits from the investment banking business continue to be one of the key influences on the company's profitability. FNS's leverage remains high, even though debt slightly declined in 1Q17. Fitch believes that FNS's ability to pay down debt, depending on its operating cash flow and dividend income, is acceptable; however, the company may have a shortfall if the domestic operating environment deteriorates significantly. The company faces refinancing risk due to its dependence on wholesale funding, however, Fitch believes this is mitigated by committed credit lines from lenders, ongoing cash generation, and an established investor base for its debentures. RATING SENSITIVITIES Fitch may consider downgrading the National Ratings of ASP or FSS if either firm's profitability declines significantly over a sustained period or if either entity aggressively expands its risky assets beyond that of industry peers or the agency's expectations. FNS's ratings could be downgraded if the company has a weaker-than-expected performance that leads to significant deterioration in key financial ratios, particularly in liquidity and leverage. Any deviation from the debt repayment plan that stems from a higher risk appetite, significant losses from core operations of its subsidiaries or affiliates, or signs of a withdrawal in creditors' confidence may result in negative rating action. Conversely, the agency may consider upgrading the ratings on ASP and FSS if the firms improve their key financial metrics through industry cycles while keeping their risk profiles and franchises relatively constant. FNS's ratings could be upgraded if the company successfully executes its debt repayment plan while improving profitability on a sustained basis so that leverage steadily declines. Contact: Primary Analysts Jackerin Jeeradit (ASP) Associate Director +66 2108 0163 Fitch Ratings (Thailand) Limited Park Venture, Level 17 57 Wireless Road, Lumpini Patumwan, Bangkok 10330 Thanasit Utamaphethai (FSS) Associate Director +66 2108 0154 Jindarat Laotaveerungsawat (FNS) Associate Director +66 2108 0153 Secondary Analysts Patchara Sarayudh (ASP, FNS) Director +66 2108 0152 Jindarat Laotaveerungsawat (FSS) Associate Director +66 2108 0153 Committee Chairperson Tim Roche Senior Director +61 2 8256 0310 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. 10 Mar 2017) here National Scale Ratings Criteria (pub. 07 Mar 2017) here Additional Disclosures Solicitation Status here#solicitation Endorsement Policy here 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 WEB SITE AT 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. DIRECTORS AND SHAREHOLDERS RELEVANT INTERESTS ARE AVAILABLE here. 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. Copyright © 2017 by Fitch Ratings, Inc., Fitch Ratings Ltd. and its subsidiaries. 33 Whitehall Street, NY, NY 10004. Telephone: 1-800-753-4824, (212) 908-0500. Fax: (212) 480-4435. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved. In issuing and maintaining its ratings and in making other reports (including forecast information), Fitch relies on factual information it receives from issuers and underwriters and from other sources Fitch believes to be credible. Fitch conducts a reasonable investigation of the factual information relied upon by it in accordance with its ratings methodology, and obtains reasonable verification of that information from independent sources, to the extent such sources are available for a given security or in a given jurisdiction. The manner of Fitch’s factual investigation and the scope of the third-party verification it obtains will vary depending on the nature of the rated security and its issuer, the requirements and practices in the jurisdiction in which the rated security is offered and sold and/or the issuer is located, the availability and nature of relevant public information, access to the management of the issuer and its advisers, the availability of pre-existing third-party verifications such as audit reports, agreed-upon procedures letters, appraisals, actuarial reports, engineering reports, legal opinions and other reports provided by third parties, the availability of independent and competent third- party verification sources with respect to the particular security or in the particular jurisdiction of the issuer, and a variety of other factors. Users of Fitch’s ratings and reports should understand that neither an enhanced factual investigation nor any third-party verification can ensure that all of the information Fitch relies on in connection with a rating or a report will be accurate and complete. Ultimately, the issuer and its advisers are responsible for the accuracy of the information they provide to Fitch and to the market in offering documents and other reports. In issuing its ratings and its reports, Fitch must rely on the work of experts, including independent auditors with respect to financial statements and attorneys with respect to legal and tax matters. Further, ratings and forecasts of financial and other information are inherently forward-looking and embody assumptions and predictions about future events that by their nature cannot be verified as facts. As a result, despite any verification of current facts, ratings and forecasts can be affected by future events or conditions that were not anticipated at the time a rating or forecast was issued or affirmed. The information in this report is provided “as is” without any representation or warranty of any kind, and Fitch does not represent or warrant that the report or any of its contents will meet any of the requirements of a recipient of the report. A Fitch rating is an opinion as to the creditworthiness of a security. This opinion and reports made by Fitch are based on established criteria and methodologies that Fitch is continuously evaluating and updating. Therefore, ratings and reports are the collective work product of Fitch and no individual, or group of individuals, is solely responsible for a rating or a report. The rating does not address the risk of loss due to risks other than credit risk, unless such risk is specifically mentioned. Fitch is not engaged in the offer or sale of any security. All Fitch reports have shared authorship. Individuals identified in a Fitch report were involved in, but are not solely responsible for, the opinions stated therein. The individuals are named for contact purposes only. A report providing a Fitch rating is neither a prospectus nor a substitute for the information assembled, verified and presented to investors by the issuer and its agents in connection with the sale of the securities. Ratings may be changed or withdrawn at any time for any reason in the sole discretion of Fitch. Fitch does not provide investment advice of any sort. Ratings are not a recommendation to buy, sell, or hold any security. Ratings do not comment on the adequacy of market price, the suitability of any security for a particular investor, or the tax-exempt nature or taxability of payments made in respect to any security. Fitch receives fees from issuers, insurers, guarantors, other obligors, and underwriters for rating securities. Such fees generally vary from US$1,000 to US$750,000 (or the applicable currency equivalent) per issue. In certain cases, Fitch will rate all or a number of issues issued by a particular issuer, or insured or guaranteed by a particular insurer or guarantor, for a single annual fee. Such fees are expected to vary from US$10,000 to US$1,500,000 (or the applicable currency equivalent). The assignment, publication, or dissemination of a rating by Fitch shall not constitute a consent by Fitch to use its name as an expert in connection with any registration statement filed under the United States securities laws, the Financial Services and Markets Act of 2000 of the United Kingdom, or the securities laws of any particular jurisdiction. Due to the relative efficiency of electronic publishing and distribution, Fitch research may be available to electronic subscribers up to three days earlier than to print subscribers. For Australia, New Zealand, Taiwan and South Korea only: Fitch Australia Pty Ltd holds an Australian financial services license (AFS license no. 337123) which authorizes it to provide credit ratings to wholesale clients only. Credit ratings information published by Fitch is not intended to be used by persons who are retail clients within the meaning of the Corporations Act 2001

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below