Global Credit Ratings has just downgraded Mmela Mobility Finance.
In its latest update on the Global Credit Ratings said it downgraded the final, public long-term credit ratings of the following Notes issued by Mmela Mobility Finance for the following reasons:
1. In light of recent information shared with GCR, it has become apparent that should MFS no longer be in existence, the absence of a fluid transition to a back-up servicer may cause a disruption in the cash flows. In this regard, elevated transition risk stems from the period wherein CSS would fully take over its role as primary servicer, which necessitates, amongst others, to obtain the relevant authorisations to access the Q-Link system (which allows the payroll deduction of the instalments owed by the borrowers). This increases the exposure of the Noteholders to operational and financial risks linked to MFS.
2. The non-adherence by certain parties to the Transaction documentation initially reviewed by GCR. GCR is of the view that this may create uncertainty for the future performance of the transaction.
3. The transition phase between the servicers caused the sharing of Servicing responsibilities on a piecemeal basis, which is deemed sub-optimal for the Transaction.
4. The late execution on NPLs curtailed collections.