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Moody's rates Mexico loans A3
Moody's Investors Service said it assigned global scale local-currency debt ratings of A3 and Mexico national scale rating of Aaa.mx to the following six enhanced loans of the State of Mexico.
The loans consist of Ps.5 billion enhanced loan from Banobras with a maturity of 21 years and a pledge of 2.93% of the state's general participations fund revenues; Ps.5 billion enhanced loan from Banobras with a maturity of 21 years and a pledge of 2.93% of the state's general participations fund revenues; Ps.8.5 billion enhanced loan from BBVA Bancomer with a maturity of 21 years and a pledge of 4.98% of the state's general participations fund revenues; Ps.800 million enhanced loan from BBVA Bancomer with a maturity of 21 years and a pledge of 0.47% of the state's general participations fund revenues; Ps.3 billion enhanced loan from Santander with a maturity of 20 years and a pledge of 1.76% of the state's general participations fund revenues; and Ps.13.4 billion enhanced loan from Banorte with a maturity of 20 years and a pledge of 7.84% of the state's general participations fund revenues.
The proceeds from these loans were used to refinance part of state of Mexico's outstanding debt, the agency explained.
The ratings reflect the underlying creditworthiness of Mexico, supported by the legal validity of the trust structure, strong trust structure and cash flows, Moody's said.
Given that the enhanced loans are rated at Mexico's country ceiling of A3, an upgrade of the global scale rating would only be possible if the sovereign rating is upgraded and if the State of Mexico's issuer rating and the credit enhancements of the loans are strengthened, the agency said.
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