ICRA Indonesia assigns a rating of [Idr]A- with Stable Outlook to PT Sinar Mas Multifinance, November 24, 2011
PT ICRA Indonesia
(ICRA Indonesia) has assigned an issuer rating of [Idr]A- (pronounced (IDR) A
minus) with a Stable Outlook to PT Sinar Mas Multifinance (SMMF). The rating
indicates adequate credit quality relative to other domestic issuers. The
rating is only an opinion on the general creditworthiness of the rated entity
and not specific to any particular debt instrument. The rating factors in the
good funding support (channeling of loans and capital infusion) that SMMF gets
from both its sister company PT Bank Sinarmas Tbk (BSIM), and its holding
company PT Sinar Mas Multi-Artha Tbk (SMMA). Such support has enabled SMMF
maintain a lower-than-average gearing as compared with peers. The rating is
however constrained by the risks arising from SMMF’s limited track record in
the used-motorcycles refinancing business and the likelihood of deteriorating
asset quality in this segment, given that it has customers with riskier credit
profiles.
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