VAR of First-To-Default note

Just received a document on FTD VAR calculation methodology from our risk management department.

What do you think of their suggested credit risk calculation for 3-bond basket (see below)?

PDnote = 1 - (1 - PDbond1)*(1-PDbond2)*(1-PDbond3)*(1-PDissuer)

where PD - probability of default

Seems to me kind of a pretty ugly approximation, does not taking account for default correlations b/w bond securities. However assuming their small number and all being blue-chips of russian market, approximation is worth it?