Announcements

South African Securitisation Programme (RF) Limited Series 2 Notes – Ratings Affirmed.

16 May 2016 — Global Credit Ratings (“GCR”) has affirmed the final, public credit ratings and outlooks accorded to the following Series 2 Notes issued by South African Securitisation Programme (RF) Limited (“SASP”) Series 2 on 8 November 2013, following a satisfactory performance review.

  • Class A1 Notes, stock code LRFA1, due 17 November 2025, ‘AA(ZA)(sf)’, Outlook Stable.
  • Class B1 Notes, stock code LRFB1, due 17 November 2025, ‘A(ZA)(sf)’, Outlook Stable. Class C1 Notes, stock code LRFC1, due 17 November 2025, ‘BBB(ZA)(sf)’, Outlook Stable.

SASP Series 2 is a public securitisation of rental and lease financed assets originated by Sasfin through Sunlyn Rentals Proprietary Limited (“Sunlyn”) and other entities approved by Sasfin which include disclosed suppliers and super non-disclosed suppliers (“SNDs”).

RATING RATIONALE

GCR reviewed the performance of the Transaction for the period 1 October 2015 to 31 March 2016. GCR was provided with the applicable monthly Surveillance Reports for the term relating to the review period. For more information, please read the SASP (RF) Limited – Series 2 Surveillance Report to be published on 16 May 2016.

The final, public credit ratings accorded to the ‘AA(ZA)(sf)’ rated securities relate to timely payment of interest and ultimate payment of principal, whilst the ratings on all other securities relate to ultimate payment of interest and ultimate payment of principal. The ratings exclude an assessment of the ability of the Issuer to pay either any (early repayment) penalties or any default interest rate penalties.

RATINGS HISTORY

Stock code
Initial Rating
Long Term Rating
Short Term Rating
Outlook
LRFA1
8 November 2013
AA(ZA)(sf)
n.a
Stable
LRFB1
8 November 2013
A(ZA)(sf)
n.a
Stable
LRFC1
8 November 2013
BBB(ZA)(sf)
n.a
Stable
       
Stock code
Last Rating
Long Term Rating
Short Term Rating
Outlook
LRFA1
24 November 2015
AA(ZA)(sf)
n.a
Stable
LRFB1
24 November 2015
A(ZA)(sf)
n.a
Stable
LRFC1
24 November 2015
BBB(ZA)(sf)
n.a
Stable

ANALYTICAL CONTACTS

Primary Analyst

Corné Els

Structured Finance Analyst

+27 11 784 1771

CorneE@globalratings.net

Secondary Analyst

Tinashe Mujuru

Junior Analyst

+27 11 784 1771

TinasheM@globalratings.net

Committee Chairperson

Emma-Jane Fulcher

Sector Head: Structured Finance Ratings

+27 11 784 1771

Fulcher@globalratings.net

APPLICABLE METHODOLOGIES AND RELATED RESEARCH

Global Master Structured Finance Rating Criteria – Feb ’16;

Global Consumer ABS Rating Criteria – Apr ’15;

SASP (RF) Ltd Series 2 Structured Financial Equipment Lease Securitisation Analysis Surveillance Report – Nov ’15.

RATING LIMITATIONS AND DISCLAIMERS

ALL GCR’S CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: http://GLOBALRATINGS.NET/UNDERSTANDING-RATINGS. IN ADDITION, GCR’S RATING SCALES AND DEFINITIONS ARE ALSO AVAILABLE FOR DOWNLOAD AT THE FOLLOWING LINK: http://GLOBALRATINGS.NET/RATINGS-INFO/RATING-SCALES-DEFINITIONS. GCR’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, PUBLICATION TERMS AND CONDITIONS AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE AT http://GLOBALRATINGS.NET.

GLOSSARY OF TERMS/ACRONYMS USED IN THIS DOCUMENT AS PER GCR’S STRUCTURED FINANCE GLOSSARY

Asset An item with economic value that an entity owns or controls.
Credit A contractual agreement in which a borrower receives something of value now, and agrees to repay the lender at some date in the future, generally with interest. The term also refers to the borrowing capacity of an individual or company
Credit Rating An opinion regarding the creditworthiness of an entity, a security or financial instrument, or an issuer of securities or financial instruments, using an established and defined ranking system of rating categories.
Default A default occurs when: 1.) The Borrower is unable to repay its debt obligations in full; 2.) A credit-loss event such as charge-off, specific provision or distressed restructuring involving the forgiveness or postponement of obligations; 3.) The borrower is past due more than X days on any debt obligations as defined in the transaction documents; 4.) The obligor has filed for bankruptcy or similar protection from creditors.
International Scale Rating LC International local currency (International LC) ratings measure the likelihood of repayment in the currency of the jurisdiction in which the issuer is domiciled. Therefore, the rating does not take into account the possibility that it will not be able to convert local currency into foreign currency or make transfers between sovereign jurisdictions.
Issuer The party indebted or the person making repayments for its borrowings.
Lease Agreement or temporary use and enjoyment of a corporeal thing (movable or immovable property) the whole or part thereof for rent. The essential elements of a contract of lease are: 1.) Undertaking of lessor to give the lessee the use and enjoyment of something; 2.) Agreement between the lessor and lessee that the lessee’s right to use and enjoyment is temporary; and 3.) Lessee’s undertaking to pay a sum or rent.
Long-Term Rating A long term rating reflects an issuer’s ability to meet its financial obligations over the following three to five year period, including interest payments and debt redemptions. This encompasses an evaluation of the organisation’s current financial position, as well as how the position may change in the future with regard to meeting longer term financial obligations.
Principal The total amount borrowed or lent, e.g. the face value of a bond, excluding interest.
Rated Securities Debt securities that have been accorded a credit rating.
Rent Payment from a lessee to the lessor for the temporary use of an asset.
Repayment Payment made to honour obligations in regards to a credit agreement in the following credited order: 3.) Satisfy the due or unpaid interest charges; 4.) Satisfy the due or unpaid fees or charges; and 5.) To reduce the amount of the principal debt.
Securities Various instruments used in the capital market to raise funds.
Securitisation Is a process of repackaging portfolios of cash-flow producing financial instruments into securities for sale to third parties.
Short-Term Rating A short term rating is an opinion of an issuer’s ability to meet all financial obligations over the upcoming 12 month period, including interest payments and debt redemptions.
Stock Code A unique code allocated to a publicly listed security.
Surveillance Process of monitoring a transaction according to triggers, covenants and key performance indicators.
Timely Payment The principal debt, interest, fees and expenses being repaid promptly in accordance with the contractual obligation.
Transaction A transaction that enables an Issuer to issue debt securities in the capital markets. A debt issuance programme that allows an Issuer the continued and flexible issuance of several types of securities in accordance with the programme terms and conditions.
Ultimate Payment A measure of the principal debt, interest, fees and expenses being repaid over a period of time determined by recoveries.


SALIENT FEATURES OF ACCORDED RATINGS

GCR affirms that a.) no part of the rating was influenced by any other business activities of the credit rating agency; b.) the ratings were based solely on the merits of the rated entity, security or financial instrument being rated; c.) such ratings were an independent evaluation of the risks and merits of the rated entity, security or financial instrument; and d.) the validity of the ratings is for a maximum of 12 months, or earlier as indicated by the applicable credit rating document.

The Arranger participated in the rating process via face-to-face meetings, teleconferences and other written correspondence. Furthermore, the quality of information received was considered adequate and has been independently verified where possible.

The ratings above were solicited by the Arranger of the Transaction; GCR has been compensated for the provision of the ratings.

The credit ratings have been disclosed to the Arranger with no contestation of the rating.

The information received from the Arranger to accord the credit ratings included the monthly portfolio performance data reporting packs relating to the underlying equipment lease portfolio covering the period October 2015 to March 2016 and the Arrears Breakdown for the same period.

https://globalratings.net/uploads/files/201605_SASP_Series_2_RA.pdf

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