The cow, they didn't really need that in Asia right now. When you are told that rating agencies are just AN INSTRUMENT of the banking cartel to get the “right major crisis”, in this case Moody's is the (banking) arm of Uncle Sam….
And they do exactly the same with us, as the saying goes Marc Touati, wait for the figures for the deficit in September, and there you will see the nuisance capacities of these establishments...
And the worst thing is that there won't even be one of French origin to contradict them... But during that time we won't will not talk about the case of the Americans...
Global Credit Research - June 24, 2013
Hong Kong, June 24, 2013 -- Moody's Investor Service has changed the outlook for Bank Strength Ratings/Baseline Estimates financial credit eight Hong Kong banks from stable to negative, and one bank's BFSR outlook from positive to stable.
(BFSRs) (BCAs) In addition, Moody's downgraded Wing Lung's bank's BFSR by one notch, and affirmed all other ratings of the nine banks.
Moody's affirmed the security deposit ratings of the nine banks involved in this rating action. However, it changed the outlook on deposit ratings for five of the nine affected banks from stable to negative, while those for the other four banks are unchanged and remain stable. please click here for a list of affected credit ratings.
This list is an integral part of this press release and identifies each issuer affected.
REASONING OF RATINGS
The rating actions follow Moody's decision to revise the outlook for Hong Kong's banking system from stable to negative.
The change in outlook for the banking system reflects the agency's concern over persistent negative real interest rates and potential real estate bubbles in Hong Kong, as well as Hong Kong taking increasing exposures to mainland China. . These factors could result in unfavorable operating conditions for Hong Kong banks over the outlook on the horizon.
Residential, commercial and industrial property prices in Hong Kong have more than doubled since 2009 and are currently at historic highs. There is growing integration between Hong Kong's economy and that of the mainland. While economic integration creates business opportunities for banks and their customers, it also requires risk. The continent's transition from an economic growth model based on export and investment to a model based on consumption creates uncertainties and may expose certain industries to excessive overcapacity.
A separate press release, which will be issued today, details the rationale for these changes in the outlook for the banking system.
All nine affected banks reported problem lending rates that were at or near historic lows at the end of 2012, and their asset quality metric compares very favorably against their global peers. However, latent risks are building up in the banking system as domestic leverage increases and exposures to the continent expand.
Moody's anticipates a shift in the outlook horizon when these banks' problem borrowing rises from current lows on terms that become more difficult. While the exact timing of the turn cannot be precisely determined, a tightening of US monetary policy, which directly affects Hong Kong via the peg of the Hong Kong dollar, is likely to be a trigger. for a cyclical deterioration in asset quality.
At the end of 2012, real estate, trade and export loan financing, and continental exposures together accounted for more than half of all bank borrowing.
Nevertheless, Hong Kong banks overall remain among the highest rated banks globally, and their credit ratings continue to reflect strengths such as solid capitalization levels, healthy investment profiles and liquidity positions, as well as the establishment of sales franchises.
Four of the nine calibrated banks affected by this rating action are subsidiaries of mainland banks. Most of them grew at a faster pace than their peers due to their parents' client names.
Their corporate exposures on the mainland are higher than the average of their peers, as they serve the offshore financing needs of corporate clients of their parent banks. The change in outlook for these banks' BFSRs takes into account the increasing integration of these banks with their parents and the fact that the quality of their exposures to the continent has not been fully checked during the downturn in economic activity.
The negative outlook on margin deposits for five of the nine banks mirrors the negative outlook on their BFSRs. The outlook for the other four banks is stable due to strong support expected from overseas and mainland parent banks, which would likely ease the downward pressure on their standalone credit quality.
The Hong Kong subsidiaries are of strategic importance to their overseas and mainland relatives, which has given Hong Kong the position of an important regional financial center, and the customer overlap between the subsidiaries and their relatives.
The subordinated debt ratings of four of the nine banks incorporate elements of systemic support, which are currently chipped away from the banks' deposit ratings.
Moody's placed the subordinated debt ratings of these four banks down on June 3, 2013, as noted in this press release. The subordinated debt ratings of these banks remain downgraded following today's rating action.
Moody's Global Bank Rating Methodology published May 31, 2013 indicated that going forward, the default approach to rating banks' subordinated debt is to notch them beyond the bank's baseline credit ratings. . The update in methodology led to simultaneous reviews of subordinated debt ratings of each bank in several Asian countries.
SPECIFIC RATING CONSIDERATIONS BY BANK
In English on the source… If you are a banker, you must have a service for that, right? ; )
source: Moodys.com via Master Confucius
Translation Folamour, free reproduction on condition that the source and the translation are cited.
Further information :
Terms & Conditions
Subscribe
Report
My comments