MARC has removed CNLT (Far East) Berhad’s (CNLT) MARC-1(bg)/A(bg)  ratings from MARCWatch Negative and revised the ratings to “not meaningful”. Subsequently, MARC has withdrawn the ratings. The rating actions follow an announcement by CNLT to Bursa Malaysia on 10 October 2007 that the Company failed to service the interest payment on the RM60.0 million CP/MTN programme. Consequently, this has resulted in an event of default which would enable the noteholders to call on the bank guarantee for full repayment of the RM60.0 million principal. The bank guarantee of RM60.0 million is provided by Aseambankers Malaysia Bhd, Malayan Banking Berhad, CIMB Bank Berhad and EON Bank Berhad which carries MARC’s rating of A based on the weakest link.

CNLT is a medium sized manufacturer of yarn based in Senawang Industrial Estate, Seremban. The company’s financial performance has deteriorated in recent years as competition and operating costs increased.