(The following statement was released by the rating agency)
Oct 02 -
-- We are assigning a 'AAA' long-term rating to debt issued under Finnvera PLC's (Finnvera's) euro medium-term note (EMTN) program.
-- The Republic of Finland (Finland) guarantees Finnvera's EMTN program.
-- The rating on the program is equalized with that on Finland as we consider the guarantee to be unconditional, irrevocable, and explicit, and designed to ensure unlimited and timely payment of the obligation.
Standard & Poor's Ratings Services today assigned its 'AAA' rating to debt issued under Finnvera PLC's (Finnvera's) euro medium-term note (EMTN) program. Finnvera is a specialized financing company owned by the State of Finland. It provides its clients with loans, guarantees, venture capital investments, and export credit guarantees.
Finnvera is also the official export credit agency of Finland. It is controlled and managed by the Ministry of Employment and the Economy. It grants and administers credits, guarantees, export credit guarantees, and also finances venture capital investments.
The 'AAA' long-term rating on the EUR3 billion debt program issued by Finnvera is based on Standard & Poor's view of credit support from Finland. The guarantee is unconditional, irrevocable, and explicit, and is designed to ensure unlimited and timely payment of the obligation.
Notes under the program will be issued in series, with each series comprising one or more tranches, issued on different dates. Each series under the program will be an unsecured, unsubordinated obligation of Finnvera and will be supported by the Finnish government's guarantee on the EMTN program. The price, amount, form, interest, and maturity will be series-specific and these will be reviewed by Standard & Poor's when assessing each series.
For Finnvera's long-term debt issued under the EMTN program, if payment is not made by Finnvera on the due date, then the Finnish government guarantee will be called. As per the guarantee undertaking, in the event that Finnvera cannot meet a payment, it is required to notify the Finnish government at least five days before the payment is due. In addition, if, on the date of payment, the fiscal agent has not received the full amount of payment, it shall notify the guarantor in addition to Finnvera and the paying agent. We expect in such a situation that the Finnish government will make the payment within five business days of the due date for payment (see "Related Criteria And Research").
The guarantee documentation also makes explicit that the creditor will be able to call on the Republic of Finland upon a default by Finnvera, without the need to first commence legal action against Finnvera for payment.
RELATED CRITERIA AND RESEARCH
-- Timeliness of Payments: Grace Periods, Guarantees, And Use Of 'D' and 'SD' Ratings, Dec. 23, 2010
-- Rating Sovereign-Guaranteed Debt, April 6, 2009 -- Sovereign Government Rating Methodology And Assumptions, June 30, 2011
-- Guarantee Default: Assessing The Impact On The Guarantor's Issuer Credit Rating, May 11, 2012
-- Finland (Republic of), June 14, 2012