Fitch assigns ratings to Yes Bank’s Indian Corporate Loan

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Fitch assigns ratings to Yes Bank’s Indian Corporate Loan

Fitch assigns expected ratings to Yes Bank’s Indian Corporate Loan Securitisation Trust – Series VIII

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Fitch Ratings has assigned an expected National Short-term rating of 'F1+(ind)(SO)' to Series A1 and Series A2 pass through certificates ("PTCs") to be issued by Yes Bank Limited ("Yes Bank") via the special purpose vehicle ("SPV"), Indian Corporate Loan Securitisation Trust - Series VIII, for securitising receivables from a 12 month loan. The final ratings are contingent upon receipt of final documents conforming to information already received.

The loan aggregates to INR500 million extended by Yes Bank Limited ("the originator" or "the seller") to SREI Infrastructure Finance Limited ("SREI" or "the obligor"). Yes Bank proposes to assign the same loan and the underlying receivables to the SPV called Indian Corporate Loan Securitisation Trust - Series VIII. The expected rating of the PTCs reflects the credit quality of the underlying obligor, the payment structure of the PTCs and the proposed legal structure of the transaction.

The SPV shall purchase the receivables from Yes Bank in trust and for the benefit of the investors. After acquiring the receivables, the SPV shall issue two classes of PTCs, Series A1 and Series A2, to the investors, for a total consideration equivalent to the value of the discounted cash flows from the loan for the next twelve months.

The issue proceeds will be used by the SPV to pay Yes Bank as consideration for the purchase of the receivables.

Yes Bank will continue to service the loan and collect the due amounts from the obligor.

The rating of the certificates remains directly linked to the rating of the underlying obligor. SREI's short-term debt programme is rated 'F1+(ind)', which indicates the highest credit quality as well as the strongest capacity for timely payment of financial commitments.

 Sourced From: Fitch Ratings