On May 13, NICE Investors Service analyzed that Daishin Securities' participation in a rights offering by Daishin F&I would have only a limited impact on its credit rating.
The previous day, Daishin F&I decided to carry out a rights offering worth 250 billion KRW. Daishin Securities, which owns 100% of Daishin F&I's shares, will participate in full through a shareholder allocation method.
NICE Investors Service explained, "The main source of funds for the rights offering is a dividend of 200 billion KRW that Daishin F&I will pay to Daishin Securities," and added, "The actual net capital inflow is about 50 billion KRW, which exceeds the dividend amount."
The agency also evaluated that Daishin Securities' participation in the rights offering would have only a limited impact on its credit rating. NICE Investors Service stated, "The recognition of dividend income from Daishin F&I will increase the company's capital on an accounting basis," but also noted, "Since the amount of the rights offering exceeds the dividend income, it is expected to slightly reduce net operating capital."
It further added, "Taking into account the capital gain of approximately 150 billion KRW secured through the sale of the headquarters building in March this year, the overall capital adequacy indicators are expected to improve compared to the end of 2024."
NICE Investors Service also predicted that this rights offering would have a positive effect on Daishin F&I. Daishin F&I specializes in investing in non-performing loans (NPLs). The agency evaluated, "With the rights offering, the dividend burden is eased and capital buffer capacity is being enhanced," and added, "If strong profitability continues, particularly in the NPL business division, it is expected to have a positive impact on the company's credit rating."
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