TEXT-Fitch afrms International Personal Finance plc at ‘BB+’
News from Reuters:

Thu Mar 29, 2012 9:15am EDT

March 29 – Fitch Ratings has affirmed International Personal Finance Plc’s (IPF) Long-term Issuer Default Rating (IDR) at ‘BB+, Short-term IDR at ‘B’ and senior unsecured debt at ‘BB+’. The Long-term IDR has a Stable Outlook.

The ratings reflect the significant credit, operational, regulatory and FX risks arising from unsecured home-collected lending in emerging markets as well as its modest business scale and diversification. The company’s funding is undiversified, relying solely on wholesale funding and its business model faces technological challenges. These risks would normally cap the ratings firmly below investment grade. However, uplift to the Long-term IDR has been provided by the company’s strong cash flow and capital generation, robust risk management, modest leverage and demonstrated management ability to rapidly restructure problem operations (Hungary in 2009).

The Stable Outlook takes into consideration IPF’s indication that it does not intend to increase its modest leverage in the near future (debt/tangible equity was a low 0.9x at FYE11) given the uncertain global economic outlook. Nonetheless, material erosion to leverage, or a sign…………… continues on Reuters

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