MTJ Development is the owner of the five-star Hotel Nikko Kuala Lumpur.
RAM said the enhanced rating reflected the unconditional and irrevocable guarantee extended by UFJ Bank Ltd, Labuan Branch, which presently carries a short-term rating of F2 from Fitch.
Under the bank guarantee structure, all risks associated with the commercial papers were expected to be absorbed by the guarantor, RAM said.
The bank guarantee also enhanced the credit profile of the commercial papers beyond that of MTJ's inherent or standalone credit risk, it said.
MTJ is 80% owned by Toyo Real Estate Ltd while Japan Airlines Co Ltd holds the balance 20% stake. – Bernama
The agency said in a statement the reaffirmation was based on the overall improvement in ABN Amro's financial profile, which was within expectations.
ABN Amro had demonstrated the resilience of its asset quality on top of its smaller non-performing loans, aided by its focus away from loan assets, it added.
Despite a drop in net interest income, the bank was able to raise its non-interest income in the fiscal year ended Dec 31, 2002.
Funding and liquidity of the bank are deemed adequate given the support from its strong parent ABN Amro Holdings – a major international banking group currently ranked 10th in Europe in terms of Tier 1 capital.
Moreover, the bank is also well capitalised and its capital adequacy ratio has strengthened to 37% over the past year.
With its focus primarily on non-interest income, ABN Amro has to ensure sustainable earnings. Efforts are being made to boost its fee income from recurring business, to balance the more volatile income from corporate advisory activities. – Bernama
The early redemption was in conjunction with the issuance of its RM500mil serial fixed-rate bonds on Nov 1 last year, of which RM150mil was earmarked for the redemption.
Given this, RAM no longer has any rating obligation on RHB Capital's RM150mil unsecured bonds, which had previously been assigned a rating of A1(s). – Bernama
MTJ Development is the owner of the five-star Hotel Nikko Kuala Lumpur.
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