March 1, 2017 / 1:50 PM / 7 months ago

Fitch Affirms UFG's French Commercial Papers at 'F1'

(The following statement was released by the rating agency) PARIS, March 01 (Fitch) Fitch Ratings has affirmed Union Finances Grains' (UFG) commercial papers (CPs) issued under the company's French CP programme at 'F1'. KEY RATING DRIVERS UFG's French CPs' 'F1' short-term ratings are aligned with the Short-Term Issuer Default Ratings (IDRs) or Fitch's assessment of the creditworthiness of the four banks guaranteeing the CPs. They reflect Fitch's view that the guarantors would be extremely likely to honour their commitment if required, as the guarantees are unconditional, irrevocable and timely. The four banks guaranteeing UFG's French CPs are Credit Agricole Corporate and Investment Bank (CACIB; A/Positive/F1), Le Credit Lyonnais (LCL), Credit Cooperatif (A/Stable/F1) and Banque Europeenne du Credit Mutuel (BECM). The ratings of LCL-guaranteed CPs are based on our assessment of the creditworthiness of LCL. BECM is wholly-owned by Banque Federative du Credit Mutuel (BFCM; A+/Stable/F1) and its debt ratings are aligned with those of BFCM based on an extremely high probability of support from the latter. The four banks guarantee the repayment of individual tranches of UFG's French CP programme, subject to a total issuance limit of EUR538.5 million applicable until 30 June 2017. The issuance limit is split as follows: EUR126 million for CACIB, EUR139 million for LCL, EUR93.5 million for Credit Cooperatif and EUR180 million for BECM. The banks' guarantees are not joint and each bank is only exposed to the CPs it guarantees. Guarantees are renewed annually on 1 July and cover CPs issued up to 30 June of the following year maturing before 30 September of that year. Fitch does not assign a rating to UFG as an entity, as it is solely an issuing vehicle. UFG is a union of agricultural cooperatives with 30 members at end-2016. Its sole purpose is to fund part of the cooperatives' cereal inventories with the issuance of CPs. UFG has no individual funding needs and its overheads are paid by a contribution of its cooperative members. RATING SENSITIVITIES The 'F1' short-term ratings assigned to the CPs issued under UFG's French CP programme would move in tandem with the Short-Term IDRs or Fitch's assessment of the creditworthiness of the guarantors, which are all at the same level. In the event of one of the guarantors being downgraded or upgraded, Fitch would assign a separate rating to the affected programme tranche. Contact: Primary Analyst Francois-Xavier Deucher, CFA Director +33 1 44 29 92 72 Fitch France S.A.S. 60, rue de Monceau 75008 Paris Secondary Analyst Julien Grandjean Analyst +33 1 44 29 91 41 Committee Chairperson Olivia Perney Guillot Senior Director +33 1 44 29 91 74 Media Relations: Francoise Alos, Paris, Tel: +33 1 44 29 91 22, Email: francoise.alos@fitchratings.com; Elaine Bailey, London, Tel: +44 203 530 1153, Email: elaine.bailey@fitchratings.com. Additional information is available on www.fitchratings.com Applicable Criteria Global Bank Rating Criteria (pub. 25 Nov 2016) here Additional Disclosures Dodd-Frank Rating Information Disclosure Form here _id=1019875 Solicitation Status here Endorsement Policy here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. 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