I. STATEMENT ON RATING

Slovak rating agency confirmed the rating granted to Ruzomberok (City of)

Long-term local currency rating    BBB+ (stable outlook)
Long-term foreign currency rating    BB+    (stable outlook)
Short-term rating    S2

The granted long-term rating in the category of transactions in Slovak crowns BBB+ (stable outlook) is one degree below the rating of the Slovak Republic (A - stable outlook). In the category of transactions in foreign currencies rating BB+ (stable outlook) has been granted to City Ruzomberok, which is one degree below the risk level of the Slovak Republic (BBB- stable outlook). Short-term rating of City Ruzomberok is S2, which is the best possible short-term rating for the entities attaining long-term rating BBB+.

Rationale:

City has approved election program for election period 2003 - 2006, defining strategic goals of development of the city and the city wards Vlkolínec, Černová, Biely potok, and Hrboltová in special areas: organisational area, regional planning, capital construction, territory marketing, living environment, education, culture, social issues and health service, sport and tourism, business development, public policy protection.
We evaluate positively the fact the inter-election continuity is being kept and activities in the area of tourism continue to be the strategic goal of the city in this election period as well. In this year, the city intends to approve the general city plan for SKI PARK zone, solving the issue of development of tourism in areas with well-created preconditions. In 2002, the city drew grant from PHARE fond in the volume of SKK 963 thousand for project studies in the area of tourism with focussing on humanisation of transport system Vlkolínec and development of cycling tourism. In the horizon of 3 years, the second important area of strategic investments in the city is the investment in thermal business.
The City has still positive financial situation. In 2002, it made surplus in the amount of SKK 13,163 million, being determined for realisation of investment plans of the city or for covering of unexpected expenditures. At the present, the city is meeting criteria according to new budget regulations valid as of January 1, 2005 - the debt-service-to-current-revenue ratio achieved the value of 6,31 % as of ultimo of 2002 (according to the legislation, maximum value represents 25%) and the indebtedness-to-current-revenues indicator reached the value of 35,09 % as of ultimo of 2002 (according to the legislation, maximum value represents 60 %). We appreciate the fact that in 2002, the city transformed foreign currency credit in Slovak currency credit using more lucrative interest rates.
In addition to realisation of the main tasks, the city tries to improve the living quality of the inhabitants. The City still supports organisation of various cultural and sports activities of its inhabitants. It strengthened its position within the joint stock company Kultúrny dom A. Hlinku (Culture house of A. Hlinka), offering more possibilities for cultural and social activities of the City.
Please don't hesitate to address your questions to autner@slovakrating.sk, or call +421 2 5464 5151.

Slovak Rating Agency
Bratislava, 27 May 2003

Long-term local currency rating	BBB+ (stable outlook)
Long-term foreign currency rating	BB+ (stable outlook)
Short-term rating	S2