Moody's rates Nuevo Leon loan Aa1.mx

Moody's Investors Service said it assigned a debt rating of Aa1.mx to a 1.6 billion in Mexican peso enhanced loan of the State of Nuevo León granted by Banobras, along with a global scale local-currency debt rating of Baa1.

The loan, which is denominated in Mexican pesos and matures in 2025, is payable through a trust to which the state has pledged 3.6% of its future federal participation revenues, Moody's said.

If the loan structure changes from the documentation submitted, Moody's said it will assess the corresponding impact these factors may have on the ratings and act accordingly.

The ratings reflect the underlying creditworthiness of the State of Nuevo León, supported by the strong trust structure based on an irrevocable notification to the Mexican Treasury to transfer the flow of participation revenues directly to the trustee, the agency said.

While most of rated structures hold individual payment accounts, in this case, the trustee holds one payment account for the three loans that are involved in the trust, Moody's said. But, the agency said it does not view this as a significant risk given that the repayment schedule is relatively straightforward.

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