KBRA Affirms Rating for Millennium Consolidated Holdings, LLC

3 May 2024   |   New York


KBRA affirms the issuer rating of BBB- for Charlotte, North Carolina-based Millennium Consolidated Holdings, LLC (“MCH”). Additionally, KBRA affirms the issuer rating of BBB for the wholly owned U.S. lead operating subsidiary, Millennium Advisors, LLC (“the firm”), an SEC-registered broker-dealer. The Outlook for all ratings is Stable.

Key Credit Considerations

The ratings are supported by KBRA’s favorable view of MCH’s management team and highly focused and optimized business model. Management has a proven track record in electronic fixed income trading historically, including through various operating environments.

Risk management continues to be hallmark of the franchise. Policies, monitoring, and testing are all key elements; of note, risk officials generally have realized trading experience, which heightens the overall quality of the risk apparatus, in KBRA’s view. Operational risk management remains at the forefront of the firm’s business model given the focus on electronic delivery and execution, though certainly appears to be well managed, with an established track record of nominal related issues.

The lower risk, flow-oriented securities trading operation that contributes to a higher quality balance sheet and comparatively stable revenue performance also supports the ratings. KBRA notes that Millennium’s improved financial performance has generally been robust – notwithstanding earnings weakness in 2021. Notably, operating results were strong in 2022-2023, a period of very high interest rate volatility. The earnings outlook is favorable, given the prospect for further interest rate and economic uncertainty, which should keep trading volumes elevated and margins substantial.

Financial leverage is modest, having improved with the debt reduction in 2023. Short-term corporate debt is not used.

The ratings are constrained primarily by the somewhat narrow operating model, although both geographic and product diversification continues, which could portend positive rating in the intermediate term.

Rating Sensitivities

Over the intermediate term, positive rating momentum would most likely develop from continued revenue diversification, both geographically and by product, which would also lessen correlated trading risk. Conversely, a significant erosion in the firm’s competitive position could have adverse rating implications if counterbalancing measures were not taken. A deterioration in the firm’s capital and leverage profile, violation of any other applicable contractual covenants, or the emergence of unexpected operational or technology issues could put downward pressure on the ratings.

To access rating and relevant documents, click here.



A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

Doc ID: 1004203

805 Third Avenue
29th Floor
New York, NY 10022
+1 (212) 702-0707
Contact Us

© 2010-2024 Kroll Bond Rating Agency, LLC. All Rights Reserved. Kroll Bond Rating Agency, LLC is not affiliated with Kroll Inc., Kroll Associates Inc., KrollOnTrack Inc., or their affiliated businesses.