I. STATEMENT ON RATING
The Slovak Rating Agency hereby assigns the City of Humenne the following credit rating:
| Long-term koruna rating | BBB (positive outlook)
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| Long-term foreign currency rating | BB + (positive outlook)
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| Short-term rating | S2
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The assigned long-term rating in the category of transactions in Slovak crowns of BBB (positive outlook) is 2 points below the credit rating of the State (A- stable outlook). In the category of foreign exchange transactions the City of Humenne was assigned the credit rating of BB + (positive outlook), which is 2 points below the risk level of the Slovak Republic. The short-term rating of the City of Humenne is S2, which is the best possible short-term rating for entities with a long-term rating of BBB.
Justification:
- The Slovak Rating Agency positively assesses the preservation of continuity in the economic strategy of the City between electoral periods. Also during this electoral period the primary strategic goals of the City continue to be the development of the industrial park Gutmanovo, improvement of City access (building of small southern bypass road), and the creation of conditions for development of business and a higher living standard of the inhabitants of the City. The development of the industrial park is projected for 30 September 2004. In addition to green field investments, the city also offers investors brown field investments in existing unused production premises in the City.
- The financial situation continues to be favourable, with the economic results of the City in 2002 ending with a surplus of SKK 29 million. To the end of 2002 available resources of the City comprised SKK 53,928,000 and short-term liabilities and the debt service of the City were covered threefold to the end of 2002 by available funds of the City. The City uses advantageous financing to a large extent, which the agency perceives as positive. Loans drawn by the City as of 30 September 2003 amounted to SKK 53.858 million, whereby as much as 97% concerned loans drawn under advantageous conditions (State housing development fund - SFRB). Despite these loans, the City still has a safe level of indebtedness.
- The agency positively assesses the preparedness of the City to draw on EU funds. The City is also acquainted with the conditions for the drawing of such funds the use of which is not sufficiently promoted, but which for the City could prove fundamental to its development. The use of non-returnable sources of financing enables the City to carry out also demanding investment projects.
Please don't hesitate to address your questions to autner@slovakrating.sk, or call +421 2 5464 5151.
Slovak Rating Agency
Bratislava, 16 December 2003