Rating Release

Agusto & Co. hereby affirms the “A+sf” rating assigned to the CERPAC Receivables Funding SPV Plc’s ₦4.877 billion with a stable outlook

The rating expires on 31-01-23

Agusto & Co. hereby affirms the “A+sf” rating assigned to the CERPAC Receivables Funding SPV Plc’s (“CERPAC”, “SPV” or “the Issuer”) ₦4.877 billion 18.25% Future Flow Receivables Backed Securitisation Bond Due 2025 (Discrete), ₦12.5 billion 15.25% Future Flow Receivables Backed Securitisation Bond Due 2025 (Series 1) and ₦1.6 billion 15.5% Future Flow Receivables Backed Securitisation Bond Due 2025 (Series 2). The assigned rating reflects our opinion on the good cash-generating capacity of the securitized receivables (CERPAC cards issued for the identification and tracking of foreign national residents in Nigeria) pledged as the primary source of repaying the Bond obligations. In addition, the honouring of the Combined Expatriate Residence Permit and Alien Cards (CERPAC) contract awarded to Continental Transfert Technique Limited (“the Sponsor”, “the Seller”, “CTTL” or “the Company”) by the Federal Government of Nigeria (FGN) provides comfort that the Issuer will continue to meet the obligations as and when due.

As at 31 January 2022, Continental Transfert Technique had produced and sold 503,970 cards out of the 900,000 based on the 2011 Judgement Debt . Based on our analysis, it will take an additional 7 years for the outstanding cards (396,030) to be sold and we estimate the cash receipts from the sale of the cards accruable to CTTL in line with the existing sharing formula will amount to ₦178.6 billion. This further demonstrates the Issuer’s good capacity to meet the bond obligations given that the rights to the cash receipts from the sale of the CERPAC cards have been fully assigned to the SPV. As at 31 January 2022, the SPV had four bonds in issue (Discrete, Series 1 & 2 Bonds totalling ₦18.97 billion) and a ₦1.25 billion 7-year 14.5% Future Flow Receivables Backed Securitisation Bond Due 2028 (Series 3 Bond) issued in July 2021. As at the same date, the Discrete, Series 1 & 2 Bonds had an aggregate outstanding principal amount of ₦5.7 billion, following the semi-annual payment of coupon and principal redemption. Although the Discrete, Series 1 & 2 Bonds have legal final maturity periods of 2025 each, the Bonds are being repaid in line with the expected maturity period of 2023, thus demonstrating the Issuer’s strong cash position through the periodic CERPAC sales collection.

The opinions expressed in this rating release do not represent investment or other advice and should therefore not be construed as such. Visit www.agusto.com for further information.