CariCRIS Credit Rating
MEDIA RELEASE
23rd July 2009
CariCRIS assigns “speculative” ratings for Dominica Agricultural, Industrial and Development Bank
Issue Ratings (For debt size of USD 10 million or equivalent)
CariBB+ (Regional Scale Foreign Currency)
CarzBB+ (Regional Scale Local Currency)
Caribbean Information and Credit Rating Services Limited (CariCRIS), the Caribbean regional credit rating agency, has assigned ratings of CariBB+ (Foreign Currency Rating) and CariBB+ (Local Currency Rating) on its Caribbean regional rating scale to the USD 10 million debt issue of Dominica Agricultural, Industrial and Development Bank. These ratings indicate that the level of creditworthiness of this obligation, adjudged in relation to other obligations in the Caribbean is speculative.
Dominica Agricultural, Industrial and Development Bank (DAID Bank) credit risk profile reflect the fact that it operates exclusively in a relatively weak, highly indebted economy and that it has limited access to funding for its core business, Additionally, its stagnated loan portfolio exhibits high levels of NPLs, increasing loan write offs and rescheduling. These weaknesses are, to some extent, mitigated by support from the Government of Dominica, its moderate financial performance and positive liquidity gaps. Going forward, access to increased funding as well as the planned organizational restructuring may improve the credit profile of the company.
CariCRIS’ CEO Wayne Dass commented that DAID Bank is the first development bank in the region to obtain a public rating from CariCRIS and extended his congratulations to the Bank’s management for their commitment to openness and transparency as demonstrated by making their rating public.
Commenting on the credit rating, DAID Bank’s General Manager, Mr. Kingsley Charles Thomas, says he welcomes the rating which together with the excellent track record of repayment of its loan obligations over the thirty-eight years of its existence, places the institution in a strong position to access additional funding to execute its mandate to facilitate economic development in the Commonwealth of Dominica. Additionally, Mr. Thomas stated that by having a credit rating which is transparent, uniform and credible, potential funding agencies are provided with the type of information which evokes confidence in their decisions. He further highlighted the fact that the DAID Bank is the first national development bank in the Region to obtain a credit rating and hopes that this will be adopted by similar institutions within the Caribbean.
About the company: The Dominica Agricultural, Industrial and Development Bank (DAID Bank) is a statutory body established by an Act of Parliament on July 28th 1971. It became a subsidiary of the National Commercial and Development Bank when this Bank was established in December 1976. It was then re-established as an autonomous institution on January 1 1982 in accordance with the DAID Bank Act Chapter 74:03. Its primary objectives, as per its legal mandate, are to promote and influence economic development in the Commonwealth of Dominica and to mobilize funds for the purpose of such development. The Bank’s core business is to provide loans to all major sectors of the economy including tourism, agriculture and agro-processing, telecommunications and other services as well as mortgages and student loans. The two shareholders are the Government of the Commonwealth of Dominica (GOCD), the majority shareholder, with 71.5% and Dominica Social Security (DSS) with 28.5%.
Please visit www.caricris.com for the detailed rating rationale on Dominica AID Bank
23rd July 2009
CariCRIS assigns “speculative” ratings for Dominica Agricultural, Industrial and Development Bank
Issue Ratings (For debt size of USD 10 million or equivalent)
CariBB+ (Regional Scale Foreign Currency)
CarzBB+ (Regional Scale Local Currency)
Caribbean Information and Credit Rating Services Limited (CariCRIS), the Caribbean regional credit rating agency, has assigned ratings of CariBB+ (Foreign Currency Rating) and CariBB+ (Local Currency Rating) on its Caribbean regional rating scale to the USD 10 million debt issue of Dominica Agricultural, Industrial and Development Bank. These ratings indicate that the level of creditworthiness of this obligation, adjudged in relation to other obligations in the Caribbean is speculative.
Dominica Agricultural, Industrial and Development Bank (DAID Bank) credit risk profile reflect the fact that it operates exclusively in a relatively weak, highly indebted economy and that it has limited access to funding for its core business, Additionally, its stagnated loan portfolio exhibits high levels of NPLs, increasing loan write offs and rescheduling. These weaknesses are, to some extent, mitigated by support from the Government of Dominica, its moderate financial performance and positive liquidity gaps. Going forward, access to increased funding as well as the planned organizational restructuring may improve the credit profile of the company.
CariCRIS’ CEO Wayne Dass commented that DAID Bank is the first development bank in the region to obtain a public rating from CariCRIS and extended his congratulations to the Bank’s management for their commitment to openness and transparency as demonstrated by making their rating public.
Commenting on the credit rating, DAID Bank’s General Manager, Mr. Kingsley Charles Thomas, says he welcomes the rating which together with the excellent track record of repayment of its loan obligations over the thirty-eight years of its existence, places the institution in a strong position to access additional funding to execute its mandate to facilitate economic development in the Commonwealth of Dominica. Additionally, Mr. Thomas stated that by having a credit rating which is transparent, uniform and credible, potential funding agencies are provided with the type of information which evokes confidence in their decisions. He further highlighted the fact that the DAID Bank is the first national development bank in the Region to obtain a credit rating and hopes that this will be adopted by similar institutions within the Caribbean.
About the company: The Dominica Agricultural, Industrial and Development Bank (DAID Bank) is a statutory body established by an Act of Parliament on July 28th 1971. It became a subsidiary of the National Commercial and Development Bank when this Bank was established in December 1976. It was then re-established as an autonomous institution on January 1 1982 in accordance with the DAID Bank Act Chapter 74:03. Its primary objectives, as per its legal mandate, are to promote and influence economic development in the Commonwealth of Dominica and to mobilize funds for the purpose of such development. The Bank’s core business is to provide loans to all major sectors of the economy including tourism, agriculture and agro-processing, telecommunications and other services as well as mortgages and student loans. The two shareholders are the Government of the Commonwealth of Dominica (GOCD), the majority shareholder, with 71.5% and Dominica Social Security (DSS) with 28.5%.
Please visit www.caricris.com for the detailed rating rationale on Dominica AID Bank
