Fitch Ratings-Istanbul/ London-22 July 2010:
Fitch Ratings has today assigned Kuveyt Turk Katilim Bankasi A.S.'s (Kuveyt Turk) forthcoming Sukuk issue an expected rating of 'BBB-'. The expected rating is in line with Kuveyt Turk's Long-term foreign currency Issuer Default Rating (IDR) of 'BBB-'.
The final rating is contingent upon receipt of final documents conforming to information already received by Fitch.
According to the draft prospectus of the planned Sukuk issue, KT Turkey Sukuk Limited (Issuer) will issue trust certificates (or 'sukuk') and use the proceeds to purchase from Kuveyt Turk, its beneficial interest and rights in a portfolio of leased assets and murabaha contracts (Portfolio Assets). The Issuer will appoint Kuveyt Turk to manage the Portfolio Assets on its behalf. Kuveyt Turk is ultimately liable for the due and punctual payment of all sums payable to the certificate holders. In addition, Kuveyt Turk will undertake to repurchase the beneficial interest and rights in the underlying Portfolio Assets in full on maturity, expected to be in 2013, or earlier if a dissolution event (which includes an event of default or breach of other obligations) occurs. Kuveyt Turk's payment obligations under this transaction will rank at least equally with the claims of all of its other unsecured and unsubordinated creditors.
Fitch presently rates Kuveyt Turk as follows: Long-term foreign and local currency IDRs 'BBB-'; Short-term foreign and local currency IDRs 'F3'; National Long-term rating 'AAA(tur)'; Individual Rating 'D'; Support Rating '2'. The Outlooks for the Long-term IDRs and the National Long-term rating are Stable.
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