Moody’s rates Tianjin FTZ Baa1, Hongkong Baorong bonds Baa2

Moody's Investors Service said it assigned a Baa1 issuer rating to Tianjin Free Trade Zone Investment Holding Group Co., Ltd. (Tianjin FTZ Investment).

At the same time, the agency assigned a provisional Baa2 senior unsecured rating to the proposed bonds issued by Hongkong Baorong Development Ltd., an indirect, wholly owned subsidiary of Tianjin FTZ Investment.

The proposed bonds will be supported by a Keepwell Deed, a Liquidity Support Deed, and a Deed of Equity Interest Purchase Undertaking between Tianjin FTZ Investment, Hongkong Baorong, and the bond trustee.

Proceeds will be used for working capital and general corporate purposes.

The outlook is stable.

Moody’s said the Baa1 issuer rating incorporates Tianjin FTZ Investment's baseline credit assessment (BCA) of b1 and a six-notch uplift based on the expectation of a very high level of support from the Tianjin Municipal People's Government (unrated), under Moody's Joint Default Analysis approach for government-related issuers.

"The very high support expectation reflects the very close ties that Tianjin FTZ Investment maintains with the Tianjin Municipal People's Government," Moody's vice president and senior analyst Chenyi Lu said in a news release.

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