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Land Bank – an update on recent events

01 Apr 2021

Olga Constantatos / Head: Credit

Company Statement

Since our last flash update on Friday 26 March, there have been a number of press articles about Land Bank detailing the events surrounding the Standard Chartered payment, as well as the removal of Land Bank’s official rating by Moodys.

Land Bank and lenders strive to find debt solution 

New proposal causes Land Bank to miss debt restructuring deadline

High noon for efforts to save Land Bank from collapse

Land Bank sinks deeper into the mire after Moodys withdraws its credit ratings of the state owned lender

Land Bank rethink is poor timing for noteholders

We provide this very brief update on these matters.

Standard Chartered matter

The proposed version 3 of the liability solution was only presented to the noteholder group in early March 2021. As previously noted, it introduced significant changes to the previous version (version 2, proposed in mid-January 2021) and was materially different to the first version of the liability solution that we had been negotiating since Land Bank first went into default in April 2020. Given the timing of the presentation of the proposed version 3 to noteholders, we believed that it was going to be a challenge to obtain the necessary agreement from all the creditors by the 31 March 2021 deadline stipulated in the court judgement on the Standard Chartered matter. We are therefore not surprised that the deadline date passed without the necessary agreement being reached.

We understand that Land Bank will be complying with the court order and that Standard Chartered will be repaid their full amounts outstanding on 1 April 2021.

Moodys Rating

While there is a requirement of Land Bank in terms of its Domestic Multi-Term Note to maintain a rating for as long as its listed notes remain outstanding, the proposed liability solution (both versions 2 and 3) envisage that the new notes will not be officially rated.

We await detailed information on several outstanding issues and will continue to assess our position as and when we get further information.

In the meantime, negotiations are continuing, to ensure the best possible outcome for our clients.

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