NACF’s AAA issue rating unaffected by reorganisation plan

Published on 20 January 2012
Based on further details recently made available to RAM Ratings on National Agricultural Cooperative Federation’s (NACF or the Cooperative) reorganisation plan, RAM Ratings continues to hold the view that the AAA/Stable rating of NACF’s senior notes under its Medium-Term Notes Programme of up to RM3.3 billion (MTN Programme) will be unaffected.

We opine that the collective roles of NACF and its newly established subsidiary, NH Bank (previously known as the Cooperative’s Credit and Banking Unit), are important to the country’s agricultural policies and will thus continue to benefit from the Government of Korea’s sturdy support. NACF’s reorganisation involves separating its profit centres into 2 new holding companies, i.e. financial and non-financial, which is due to be completed by 2 March 2012. Post-reorganisation, NH Bank will be added as a co-obligor in respect of NACF's MTN Programme.

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