Fitch Ratings has affirmed Tunisia-based Caisse des Prets et de Soutien des Collectivites Locales’ (CPSCL) National Long-Term Rating at ‘AA(tun)’ with a Stable Outlook, it said Tuesday. Fitch has also affirmed CPSCL’s National Short-Term Rating at ‘F1+(tun)’.
Fitch classifies CPSCL as a government-related entity (GRE) of Tunisia (CCC/Under Criteria Observation) due to the very strong links between the entity and the Tunisian state and the strong incentive the state has to support CPSCL, as reflected by the high share of debt guaranteed by the state.
The ratings agency said CPSCL benefits from the strong legal status of non-administrative
public establishment considered as a public company (Etablissement public a caractere non-administratif considere comme entreprise publique; EPNA) according to Tunisian law, in particular the 31 March 1997 decree.
The EPNA status implies that CPSCL cannot be liquidated and that it may only be dissolved by law or by decree. In the event of liquidation, Fitch considers that CPSCL’s assets and liabilities would be taken over by the state.
Although CPSCL is likely to change its legal status to that of a specialized financing company in order to expand its activities, Fitch expects the state will continue its tight monitoring of CPSCL’s activities, Fitch pointed out.