(The following statement was released by the rating agency) LONDON, September 25 (Fitch) Fitch Ratings has assigned Morocco-based Fondation Attawfiq Micro-Finance (Attawfiq) a National Long-Term Rating of 'A-(mar)' with a Stable Outlook, a National Short-Term Rating of 'F2(mar)' and a Support Rating (SR) of '3'. KEY RATING DRIVERS - NATIONAL RATINGS AND SR Attawfiq's ratings are based on Fitch's view that there would be a moderate probability of support from its founder Groupe Banque Centrale Populaire (GBCP), if required. GBCP is the second-largest bank in Morocco by total assets and is a systemically domestic important bank. In Fitch's view, support from the state would flow through GBCP to Attawfiq if needed. Morocco has a Long-term foreign currency Issuer Default Rating (IDR) of 'BBB-' and a Long-term local-currency IDR.of 'BBB'. The ratings reflect GBCP's ability (based on potential support available from the Moroccan state if needed) and willingness to support Attawfiq given the tight links between the micro-finance entity and GBCP. Attawfiq is of small size relative to GBCP (0.7% of GCBP's assets at end-2012), which makes financial support from GBCP easier to provide, even if GBCP faced financial stress. Fitch views Attawfiq as strategically important to GBCP. However, Attawfiq's micro-finance activity is not core to GBCP. Attawfiq operates independently from its founder with its own activity, name, branch network and employees. Attawfiq is highly dependent on GBCP for its funding and liquidity. It benefits from GBCP's internal procedures and controls, risk management and IT systems. The Stable Outlook on Attawfiq's National Long-term Rating indirectly reflects the Stable Outlook on Morocco's Long-term IDRs, given that Fitch's assessment of GBCP's capacity to support Attawfiq factors in potential support from the Moroccan state. Attawfiq is the second largest microfinance association in Morocco, and originates microloans to economically vulnerable individuals to develop their production or service business. RATING SENSITIVITIES - NATIONAL RATINGS AND SR Attawfiq's National Ratings are sensitive to any movement of Morocco's Long-term local currency IDR. A downgrade of the SR would require a multi-notch downgrade of Morocco's sovereign rating. Any material change in Fitch's view of Attawfiq's strategic importance to GBCP would also be reflected in the ratings. Contact: Primary Analyst Sonia Trabelsi Director +33 144 29 91 42 Fitch France S. A. S 60 rue de Monceau 75008 Paris Secondary Analyst Solena Gloaguen Director +44 20 3530 1126 Committee Chairperson Francesca Vasciminno Senior Director +39 02 879087 225 Media Relations: Hannah Huntly, London, Tel: +44 20 3530 1153, Email: hannah.this site Additional information is available on this site Applicable criteria, 'Global Financial Institutions Rating Criteria' dated 15 August 2012, 'Evaluating Corporate Governance', dated 12 December 2012, 'National Ratings Criteria' dated 19 January 2011, and 'Rating FI Subsidiaries and Holding Companies', dated 10 August 2012 are available at this site. Applicable Criteria and Related Research: Global Financial Institutions Rating Criteria here Evaluating Corporate Governance here National Ratings Criteria here Rating FI Subsidiaries and Holding Companies here Additional Disclosure Solicitation Status here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW. FITCHRATINGS. COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.
(The following statement was released by the rating agency) CHICAGO, May 20 (Fitch) Captive finance subsidiaries of major global manufacturers (captives) have continued to report very strong profit margins, driven by outstanding credit-loss performance and improved demand for their parents' products. Portfolio growth and credit quality gains are likely to moderate, however, as competition with banks heats up, says Fitch. Most captives reported robust origination trends in 2012 and 1Q13 as access to low-cost funding remained good and demand for parent products picked up. Auto captives, including Ford Credit and General Motors Financial (GMF), have benefited from improving demand for new vehicles and stronger auto ABS volumes. Major equipment captives such as Caterpillar Financial Services and John Deere Capital have seen strong portfolio growth as better demand trends in the U.S. and Asia have offset continuing softness in Europe. Growth rates will likely slow somewhat, as banks take advantage of abundant low-cost deposits and expand their exposure to capital-efficient consumer and commercial lending Most major captives ended 2012 with credit-loss metrics at historic lows. This reflected the impact of a broad-based tightening of underwriting standards, as well as ongoing improvements in the U.S. labor market and rising demand for used vehicles and equipment. We expect credit quality trends to normalize over the remainder of 2013 as underwriting terms begin to loosen in the face of heightened competition. In addition, used vehicle and equipment prices are likely to come under greater pressure moving into next year. Captives and their parents have benefited from excellent access to wholesale capital markets to diversify and strengthen their funding profiles. New sources of funding have allowed companies to term out debt maturities, while increasing liquidity buffers, in order to reduce refinancing risk and support additional portfolio growth. Balance sheet leverage at captives remains below their five-year averages, which, given record low credit losses and expected moderation in portfolio growth, could result in increased dividends to parents. GE Capital Corp.'s (GECC) announcement today that it plans to return $6.5 billion in dividends to its parent, General Electric Corp. in 2013, reflects this view. Ratings for captives are equalized with those of their corporate parents if Fitch considers them to be core subsidiaries. Currently, all Fitch-rated captives with the exception of GMF are considered core to their parent as a result of strong integration and the critical importance of finance subsidiary activities to the parent's overall business. GMF is currently on Rating Watch Positive, reflecting our view that it will become core to GM as it acquires international operations in the near term. For a detailed review of the financial performance and credit profiles of major captive finance companies, see "Captive Finance Companies: 2012 Comparative Analysis," dated May 20, 2013, at this site Contact: Mohak Rao, CFA Director Financial Institutions +1 212 908-0559 Bill Warlick Senior Director Fitch Wire +1 312 368-3141 Fitch, Inc. 70 W. Madison Chicago, IL 60602 Media Relations: Brian Bertsch, New York, Tel: +1 212-908-0549, Email: brian.this site The above article originally appeared as a post on the Fitch Wire credit market commentary page. The original article can be accessed at this site All opinions expressed are those of Fitch Ratings. Applicable Criteria and Related Research: Captive Finance Companies here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW. FITCHRATINGS. COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.