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Bourse keeps good ratings

Published: 
Tuesday, July 17, 2018

Caribbean Information & Credit Rating Services Limited (CariCRIS) has reaffirmed the CariA- regional rating and ttA- rating on the national scale of Bourse Securities Limited (BSL). This means that the company’s level of creditworthiness within T&T and the Caribbean is good.

The regional ratings agency also maintained a stable outlook on the ratings, premised on the expectation of continued profitability and maintenance of a healthy net interest spread, notwithstanding constraints on core income in light of subdued economic conditions in T&T and ongoing investment risks globally.

“We expect the BSL Group to maintain a generally stable credit profile over the next 12-15 months, underpinned by low leverage, strong capital buffers and liquid portfolios,” CariCRIS said.

“The ratings of BSL reflect the company’s continued favourable financial performance as reflected in its good diversity of income streams, improved efficiency levels and continued profitability, though lower in 2017.

“The ratings continue to be supported by good asset quality, underpinned by a diverse investment portfolio, as well as the positive impact of ongoing measures taken by the company’s management to continuously review its Enterprise Risk Management Framework. Also adding to the overall good credit ratings is the company’s sound asset liability management practices, which contribute to an overall strong liquidity profile.”

CariCRIS added, however, the BSL’s good ratings is tempered by the fact that its funding base “remains highly concentrated towards a small number of large institutional investors, subjecting the company to significant refinancing risks, should these investors require repayment of the associated liabilities at short notice.

“Given the global outlook for rising interest rates, timely replacement of these interest-sensitive funds to support business operations, if necessary, will likely be refinanced at a higher cost in the short term. In addition, further interest rate increases over the next 12-15 months could lead to lower net interest income.”

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