Manila Times.net
MOODY’s Investors Service has upgraded its debt ratings for National Power Corp. and Power Sector Assets and Liabilities Management Corp. (PSALM).
In a statement, Jennifer Wong, Moody’s assistant vice-president, said the credit rating upgrade for Napocor and PSALM is in line with the debt watcher’s decision to upgrade the Philippine government’s long-term foreign and local currency rating from Ba3 to Ba2.
“In light of PSALM’s 100 percent ownership by the Philippine government, its distinct policy role, as mandated by law to restructure and reform the country’s power sector, and the government’s intention to assume any remaining assets and liabilities at the end of its corporate life, we view PSALM as an extension of the government,” Wong said.
The analyst also said that all debt issued by PSALM is “unconditionally and irrevocably” guaranteed by the government. And as such, the company’s rating is closely integrated with, and strongly linked to, the government’s credit quality.
PSALM was established in 2001 to take ownership of and manage all generation-related assets, liabilities, contracts with independent power producers, real estate and other disposable assets of Napocor.
PSALM is also mandated to privatize and dispose of these assets to settle Napocor’s financial obligations.JAMES KONSTANTIN GALVEZ
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