Ratings


  • Business
  • Saturday, 31 Jul 2004

  • RATING Agency Malaysia (RAM) has reaffirmed the A3 rating on AKN TECHNOLOGY BHD's RM55mil nominal value non-convertible redeemable secured bonds (1999/2004) with a stable outlook. 

    RAM said in a statement the rating reflected AKN's average business profile and fairly strong balance sheet, underscored by a low net gearing ratio and commendable liquidity position. 

    Nevertheless, these strengths were moderated by the cyclical nature of the semiconductor industry and its high concentration risk in terms of principals, customers and industry segment. 

    Stiff market competition and pricing pressure were also inherent risks for its lead-frames and contract-manufacturing business, RAM said. 

    “Since our previous rating review, AKN has acquired SR Technology Sdn Bhd, which is principally involved in the packaging and assembly of semiconductor products.” 

    Additionally, AKN and its other joint-venture partners have agreed to inject US$20mil to fund the capital requirements of associate Nanochip Inc, USA. 

    The management is expected to undertake further expansion programme in the medium term. – Bernama 

  • RAM has reaffirmed COMMERCE INTERNATIONAL MERCHANT BANKERS BHD's (CIMB) long- and short-term general bank ratings at AA3 and P1, respectively.  

    In a statement, RAM said the rating of the bank's RM600mil negotiable certificates of deposit had also been reaffirmed at AA3. Both ratings carried a stable outlook, it said.  

    It added that its rating reaffirmation was based on CIMB's ability to maintain clear visibility in the market via its strong franchise and high-profile business deals. 

    “More importantly, this had translated into its improved bottom line in the year to December 2003 compared with FY2002. With significant market shares in various merchant-banking activities and as the leader among the local merchant banks, CIMB is expected to reap more benefits from the conducive market environment than its smaller peers,” RAM said. 

    But CIMB might have a higher risk appetite that could lead to a more erratic earnings profile, the rating agency said, adding that like its industry peers, CIMB faced the challenge of volatile bond trading income. 

    “Nonetheless, this is mitigated to a certain extent by its well-developed risk-management framework as well as its good track record in managing these risks,” it said.  

    RAM said CIMB's management was making concerted efforts towards enhancing the bank's presence in the retail equity market and private banking services as it realised that the bank was still small as far as retail business was concerned. –AFX-Asia 

  • AMBANG SENTOSA SDN BHD's (ASSB) RM388mil Class A Al-Bai Bithaman Ajil Islamic debt/asset-backed securities (BaIDS/ABS) has been redeemed and cancelled on July 28. 

    The confirmation was received from facility agent, Abrar Discounts Bhd, Malaysian Rating Corp Bhd (MARC) said in a statement .  

    Following this, MARC no longer has any rating obligation on the Class A BaIDS and the AA- ID rating is hereby withdrawn. 

    MARC said it was now undertaking the rating review exercise on ASSB's RM372mil Class B and RM226mil Class C BaIDS/ABS. – Bernama 


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