S&P lowers Neo-China Land

Standard & Poor's said it lowered the long-term corporate credit rating on Neo-China Land Group (Holdings) Ltd. to CCC+ from B- and its $400 million senior unsecured notes due 2014 to CCC from CCC+.

The outlook is negative.

"The rating action follows Neo-China's interim result announcement for the six months ending Oct. 31, 2008 that highlighted the company's deteriorating financial performance and further tightened liquidity position," S&P analyst Bei Fu said in a statement.

The rating reflects Neo-China's vulnerable liquidity position, weak corporate governance measures and substantially reduced financial flexibility, the agency said.

The rating also considers the company's exposure to the cyclical and competitive Chinese real estate industry, which is currently volatile and challenging, and the evolving regulatory environment, the agency added.

These weaknesses are slightly tempered by Neo-China's diversified and low-cost land bank, S&P said, as well as a reasonable development track record for the rating category.

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