RATING ACTION:
On September 15, 2022, CariCRIS reaffirmed the assigned Issuer/Corporate Credit ratings of CariA- (Foreign and Local Currency Ratings) on the regional rating scale, and ttA- (Foreign and Local Currency Rating) on the Trinidad and Tobago national scale to Home Mortgage Bank (or the Bank). The stable outlook was maintained.
RATING SENSITIVITY FACTORS:
Factors that could, individually or collectively, lead to an improvement of the rating and/or outlook:
- An improvement in the credit rating of the sovereign over the next 12-15 months
- Improvement in the Bank’s interest spread to > 3%, sustained over a 3-year period
- NPLs/Gross loans improve to 5% or below over the next 12-15 months
Factors that could, individually or collectively, lead to a lowering of the rating and/or outlook:
- A deterioration in the credit rating of the sovereign over the next 12-15 months
- A sustained increase in the cost of funds by 100 bps or greater over the next 12-15 months
- NPL’s >9% over the next 12-15 months
- A deterioration of the total earning assets/ total interest-bearing liabilities ratio to < 1 time
RATING RATIONALE
Caribbean Information and Credit Rating Services Limited (CariCRIS) has reaffirmed the assigned Corporate Credit ratings of CariA- (Foreign and Local Currency) on the regional rating scale, and ttA- on the Trinidad and Tobago (T&T) national scale to Home Mortgage Bank (HMB or the Bank). These ratings indicate that the level of creditworthiness of this obligor, adjudged in relation to other obligors in the Caribbean and within T&T is good.
CariCRIS has also maintained a stable outlook on the ratings. The stable outlook is based on our expectation that the Bank will continue to display good profitability and capitalization levels; supported by the likely improvements in economic activity over the next 12-15 months despite the challenges presented by the coronavirus (COVID-19) pandemic, as well as the Russia/Ukraine conflict. While we anticipate no material improvement in asset quality for the remainder of the year, we expect some improvement in 2023 as economic activity gathers pace. Furthermore, the Company is expected to comfortably cover its interest payments as they come due over the next 12 months.
Analysts’ Contact Info:
Anelia Oudit
Mobile : 1-868-487-8364
aoudit@caricris.com
Nadia Sanchez
nsanchez@caricris.com
Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.
