PhilEXIM gets triple A credit rating
April 8, 2003 | 12:00am
The Philippine Export-Import Credit Agency (PhilEXIM) was given the credit rating of AAA by the Philippine Rating Services Corp. (PhilRatings) for its "very strong capacity to meet financial commitments."
PhilEXIM is a line agency of the Department of Finance (DOF) and the country’s official export credit agency.
"This is a significant step of PhilEXIM in its pursuit to be among the country’s best and well-performing government financial institutions (GFI). We appreciate this development as a recognition of our shop’s fiscal abilities and liquidity," Joel C. Valdes, PhilEXIM president and chief executive officer said.
With such a rating, PhilEXIM becomes the first and only government institution in the country to be given an AAA issuer credit rating, to date, which PhilRatings described as "measuring the overall credit worthiness of a company or its ability to meet outstanding financial commitments.
The PhilRatings report also recognized PhilExim’s position as that of having a "positive financial profile given its satisfactory asset quality and profitability as well as a very conservative capitalization." The agency’s profitability performance comes in the midst of the country’s economic woes. Valdes pointed out that the triple A rating serves as the best seal of guarantee for its partner banks and counterpart institutions insofar as funding and financial facilities are concerned.
Formerly known as the Trade and Investment Development Corp. of the Philippines (Tidcorp), PhilEXIM is a GFI that offers lending facilities as well as provides sovereign guarantees and credit insurance to small and medium enterprises (SMEs), exporters and businesses considered as priority sectors (infrastructure, agro-modernization, tourism, and information and communications technology) of the national government.
As of February this year, it had already released a total of P256.7 million in guarantees and credit insurance to SMEs.
Valdes indicated that it has been putting in place more than P1 billion in standby funding from foreign sources, and more than P90 billion in funds for its programs. Unfortunately, its programs are not fully availed of in view of the lack of awareness from the public towards the institution.
"We were anticipating more guarantees and credit insurances released last year had the public known and fully appreciated our shop and the kind of mandate it delivers," he said.
Last year, the agency realized total assets amounting to P1.3 billion last year. Despite a lackluster business environment, many of the institution’s market, particularly the SMEs and exporters, benefited from its aggressive campaign.
As of December 2002, its outstanding guarantees amounted to P5.62 billion, outstanding credit insurance reached P122.81 million, while its outstanding direct lending totaled P51.67 million.
"This credit rating is the best seal of guarantee that our shop is a safe choice of credit and financing services," Valdes said in a statement. "More importantly, this is an independent yardstick which shows our company’s prudence in terms of risk management and that stacks us up better among the GFIs."
Under Bangko Sentral ng Pilipinas (BSP) Circular 280, PhilEXIM is the only GFI with a zero-risk weight. This means that creditors guarantee will not be constrained either by capital inadequacy or single borrowers limit.
"We are looking forward to concentrating on obtaining an international credit rating by the end of the year to complement the high local rating," he concluded.
Meanwhile, the line agency of the finance department is timing its lending focus with the national SME development plan of the national government. It is one of the signatories of the memorandum of agreement on the SME Unified Lending Opportunities for National Growth (Sulong) program together with the other government financial institutions (GFIs).
The other GFIs involved in the program are the Land Bank of the Philippines, the Development Bank of the Philippines, the Social Security System, the Small Business Guarantee and Financing Corp., and Quedancor.
The Sulong program will be under PhilEXIM’s special credit facility. Through this lending window, it can provide up to P5 million in credit and financing for an SME applicant to serve as working capital, and improvement in business or infrastructure, among others, under lower than prevailing market rates.
PhilEXIM is a line agency of the Department of Finance (DOF) and the country’s official export credit agency.
"This is a significant step of PhilEXIM in its pursuit to be among the country’s best and well-performing government financial institutions (GFI). We appreciate this development as a recognition of our shop’s fiscal abilities and liquidity," Joel C. Valdes, PhilEXIM president and chief executive officer said.
With such a rating, PhilEXIM becomes the first and only government institution in the country to be given an AAA issuer credit rating, to date, which PhilRatings described as "measuring the overall credit worthiness of a company or its ability to meet outstanding financial commitments.
The PhilRatings report also recognized PhilExim’s position as that of having a "positive financial profile given its satisfactory asset quality and profitability as well as a very conservative capitalization." The agency’s profitability performance comes in the midst of the country’s economic woes. Valdes pointed out that the triple A rating serves as the best seal of guarantee for its partner banks and counterpart institutions insofar as funding and financial facilities are concerned.
Formerly known as the Trade and Investment Development Corp. of the Philippines (Tidcorp), PhilEXIM is a GFI that offers lending facilities as well as provides sovereign guarantees and credit insurance to small and medium enterprises (SMEs), exporters and businesses considered as priority sectors (infrastructure, agro-modernization, tourism, and information and communications technology) of the national government.
As of February this year, it had already released a total of P256.7 million in guarantees and credit insurance to SMEs.
Valdes indicated that it has been putting in place more than P1 billion in standby funding from foreign sources, and more than P90 billion in funds for its programs. Unfortunately, its programs are not fully availed of in view of the lack of awareness from the public towards the institution.
"We were anticipating more guarantees and credit insurances released last year had the public known and fully appreciated our shop and the kind of mandate it delivers," he said.
Last year, the agency realized total assets amounting to P1.3 billion last year. Despite a lackluster business environment, many of the institution’s market, particularly the SMEs and exporters, benefited from its aggressive campaign.
As of December 2002, its outstanding guarantees amounted to P5.62 billion, outstanding credit insurance reached P122.81 million, while its outstanding direct lending totaled P51.67 million.
"This credit rating is the best seal of guarantee that our shop is a safe choice of credit and financing services," Valdes said in a statement. "More importantly, this is an independent yardstick which shows our company’s prudence in terms of risk management and that stacks us up better among the GFIs."
Under Bangko Sentral ng Pilipinas (BSP) Circular 280, PhilEXIM is the only GFI with a zero-risk weight. This means that creditors guarantee will not be constrained either by capital inadequacy or single borrowers limit.
"We are looking forward to concentrating on obtaining an international credit rating by the end of the year to complement the high local rating," he concluded.
Meanwhile, the line agency of the finance department is timing its lending focus with the national SME development plan of the national government. It is one of the signatories of the memorandum of agreement on the SME Unified Lending Opportunities for National Growth (Sulong) program together with the other government financial institutions (GFIs).
The other GFIs involved in the program are the Land Bank of the Philippines, the Development Bank of the Philippines, the Social Security System, the Small Business Guarantee and Financing Corp., and Quedancor.
The Sulong program will be under PhilEXIM’s special credit facility. Through this lending window, it can provide up to P5 million in credit and financing for an SME applicant to serve as working capital, and improvement in business or infrastructure, among others, under lower than prevailing market rates.
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