Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

 

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

 

Terms of One-Time Website Use

 

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

 

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

 

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

 

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

 

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

MOODY'S CONFIRMS AND LOWERS THE RATINGS OF CHINESE FINANCIAL INSTITUTIONS

03 Dec 1998
MOODY'S CONFIRMS AND LOWERS THE RATINGS OF CHINESE FINANCIAL INSTITUTIONS New York, December 03, 1998 -- Moody's Investors Service confirmed the Baa1 long-term foreign currency debt rating of Bank of China, and the Baa2, Prime-3 long- and short-term foreign currency deposit ratings of Industrial & Commercial Bank of China, Bank of China, China Construction Bank, Agricultural Bank of China, and Bank of Communications. The Baa2 foreign currency debt rating, the Prime-3 commercial paper rating, and the D financial strength rating of China International Trust & Investment Corporation (CITIC), as well as the Baa3 and Prime-3 long- and short-term foreign currency deposit ratings, and the D financial strength rating of CITIC Industrial Bank, were also confirmed.
Meanwhile, Moody's lowered the long-term foreign currency debt ratings of the State Development Bank of China, and the Export-Import Bank of China from A3 to Baa1, and those of Industrial & Commercial Bank of China, China Construction Bank, Agricultural Bank of China, and Bank of Communications from Baa1 to Baa2. The financial strength rating of Bank of China was also lowered from D to E+, that of Bank of Communications from D+ to D, and those of Industrial & Commercial Bank of China, China Construction Bank, and Agricultural Bank of China from E+ to E.
In addition, Moody's lowered the long-term foreign currency debt ratings of China Merchants Bank and China Investment Bank from Baa3 to Ba2. The long- and short-term foreign currency deposit ratings of China Merchants Bank and China Investment Bank were lowered from Baa3 and Prime 3 to Ba2 and Not Prime, those of Guangdong Development Bank from Baa3 and Prime 3 to B1 and Not Prime, and the long-term foreign currency deposit rating of Shanghai Pudong Development Bank from Ba1 to Ba2. The financial strength rating of China Merchants Bank was also lowered from D to E+, and those of China Investment Bank and Guangdong Development Bank from D to E.
The rating outlook for the two policy banks, the four state commercial banks, Bank of Communications, and CITIC is stable. For the other banks, the rating outlook remains negative.
Moody's said that its rating actions were based on a continued decline in the financial health of the Chinese banking system, despite the central authorities' accelerated reform efforts, the consequent heightened credit risk of the banking system, and the widening credit risk disparity among different groups of the banks in the system.
According to the rating agency, the economic and operating environment for the Chinese banking system has become substantially more difficult in recent years. The slowdown in the domestic economy, intensifying commodity price deflation, overcapacity, and the Asian financial crisis, have placed severe pressure on the already weak financial condition of the corporate sector. As a result, the banks continue to experience rising loan delinquencies, aggravating their already weak asset quality. In addition, Moody's noted that some of the government's recent policy initiatives that are intended to achieve other important macroeconomic and social goals, nevertheless have so far had a negative impact on the banking system. The five rounds of interest rate cuts since 1997 have sharply reduced the banks' profits. The pressure on the banks, particularly the policy and the state commercial banks, to continue to lend to the loss-making state sector will, in Moody's opinion, lead to further asset quality problems at these institutions.
On the other hand, Moody's noted that the Chinese government has shown serious commitment to deal with the deep-rooted problems in the country's banking system, as well as in the broader financial sector. The authorities' decisive action in closing down weak financial institutions, the recent and long overdue restructuring of the central bank to enhance its regulatory function, and the central government's commitment to further the reform process, are, in Moody's view, all critically important steps towards the improvement of the system's long-term health. However, Moody's cautions that, given the magnitude of the severe structural weakness in China's financial system, as well as the social and political constraints, it remains a formidable challenge for the Chinese government to improve the health of the financial system, particularly at a time of great stress from domestic and external sources. Consequently, Moody's believes that, over the short- to medium-term, the financial condition of the Chinese banks will continue to decline, under the pressure of a slowing economy and worsening conditions in the corporate sector.

Comments on Specific Banks

Policy Banks
The lowering of the debt ratings of State Development Bank and Export-Import Bank reflects the expected deterioration in their financial fundamentals as they support the policies of the government through their lending. It also incorporates the elevated risks to creditors of all banking institutions as a result of the changes in the regulatory environment, and the rating agency's expectation that over the long term the PRC government will increasingly distance itself from non-sovereign entities.

State Commercial Banks
The lowering of the four state banks' financial strength ratings includes Moody's assessment of the continued deterioration of their financial fundamentals. Moody's notes that, although the four banks have become more cautious in their lending, and have taken steps to strengthen control over their far-flung local branches, these are recent measures which, in Moody's view, will still take time to prove their effectiveness. Meanwhile, the slowing economy, the sharply worsening financial condition of the corporate sector, and the banks' continued role in supporting the government's economic and social policies, will continue to drive their financial fundamentals, over the short- to medium-term.
Moody's decision to differentiate the debt rating of Bank of China from those of the other three state commercial banks reflects its view that Bank of China is likely to receive a higher degree of support from the Chinese government. In Moody's opinion, not only does Bank of China possess comparatively stronger financial fundamentals, and more potentially valuable franchises, especially those resulting from its traditional role as China's designated foreign exchange bank, but it also represents China's image and reputation in international markets.
In Moody's view, Bank of Communications enjoys the benefits of a strong nationwide franchise and relatively commercial banking practices. However, despite its comparatively better financial fundamentals, compared to the four state commercial banks, it has not been able to escape the systemic weaknesses. In addition, with the development of the newer commercial banks and the gradual commercialization of the state commercial banks, BoCOM's pioneer role in experimenting with commercial banking practice in China has been eroded. However, in Moody's opinion, despite its declining strategic value, its relationship with the central government remains close.

Commercial Banks
In Moody's opinion, aside from a general deterioration in their financial fundamentals caused by factors that are common to the whole banking system, the credit quality disparity within this group, as well as against the policy banks and the state commercial banks, has sharply heightened. This is primarily caused, in Moody's opinion, by the weakening of regulatory support, as part of the central government's understandable efforts to further distance itself from those entities that are not directly controlled by the central government. Recent regulatory actions, notably the closure of GITIC, of Hainan Development Bank, and of numerous credit cooperatives and finance companies, indicate an important shift in China's regulatory stance towards impaired financial institutions from one of forbearance to one of imposing discipline. As a result, Moody's feels that the risks to fragile commercial banks have been substantially elevated.

China International Trust & Investment Corporation (CITIC)
CITIC's ratings are confirmed based on Moody's view that the company remains a significant financial institution in China, with an important portfolio of financial sector businesses of great potential value. The rating agency also notes that its usefulness to China's central government remains high, and its relationship close.

The following ratings were confirmed:
Industrial and Commercial Bank of China: the long- and short-term foreign currency deposit rating of Baa2 and Prime-3;
Bank of China: the foreign currency debt rating of Baa1; the long- and short-term foreign currency deposit rating of Baa2 and Prime-3.
China Construction Bank: the long- and short-term foreign currency deposit rating of Baa2 and Prime-3.
Agricultural Bank of China: the long- and short-term foreign currency deposit rating of Baa2 and Prime-3.
Bank of Communications: the long- and short-term foreign currency deposit rating of Baa2 and Prime-3.
China International Trust & Investment Corporation: the long-term foreign currency debt rating of Baa2; the commercial paper rating of Prime-3; and the financial strength rating of D.
CITIC Industrial Bank: the long- and short-term foreign currency deposit rating of Baa3 and Prime-3; and the financial strength rating of D.

The following ratings were lowered:
The State Development Bank of China: the long-term foreign currency debt rating from A3 to Baa1.
The Export-Import Bank of China: the long-term foreign currency debt rating from A3 to Baa1.
Industrial and Commercial Bank of China: the long-term foreign currency debt rating from Baa1 to Baa2; and the financial strength rating from E+ to E.
Bank of China: the financial strength rating from D to E+.
China Construction Bank: the long-term foreign currency debt rating from Baa1 to Baa2; and the financial strength rating from E+ to E.
Agricultural Bank of China: the long-term foreign currency debt rating from Baa1 to Baa2; and the financial strength rating from E+ to E.
Bank of Communications: the long-term foreign currency debt rating from Baa1 to Baa2; and the financial strength rating from D+ to D.
China Merchants Bank: the long-term foreign currency debt and deposit ratings from Baa3 to Ba2; and the short-term foreign currency deposit rating of Prime-3 to Not-Prime; and the financial strength rating from D to E+.
Guangdong Development Bank: the long-term foreign currency deposit rating of Baa3 to B1; the short-term foreign currency deposit rating of Prime-3 to Not-Prime; and the financial strength rating of D to E.
China Investment Bank: the long-term foreign currency debt and deposit ratings from Baa3 to Ba2; and the short-term foreign currency deposit rating of Prime-3 to Not-Prime; and the financial strength rating from D to E.
Shanghai Pudong Development Bank: the long-term foreign currency deposit rating of Ba1 to Ba2.
No Related Data.
© 2020 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND/OR ITS CREDIT RATINGS AFFILIATES ARE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY'S (COLLECTIVELY, "PUBLICATIONS") MAY INCLUDE SUCH  CURRENT OPINIONS. MOODY'S INVESTORS SERVICE DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY'S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY'S INVESTORS SERVICE CREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS ("ASSESSMENTS"), AND  OTHER OPINIONS INCLUDED IN MOODY'S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY'S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY'S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND  PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND  PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY'S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND PUBLISHES  ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR  PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT.

MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY'S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided "AS IS" without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY'S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing its Publications.

To the extent permitted by law, MOODY'S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY'S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY'S.

To the extent permitted by law, MOODY'S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY'S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY'S IN ANY FORM OR MANNER WHATSOEVER.

Moody's Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody's Corporation ("MCO"), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody's Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody's Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and Moody's investors Service also maintain policies and procedures to address the independence of Moody's Investors Service credit ratings and credit rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold credit ratings from Moody's Investors Service and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading "Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy."

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY'S affiliate, Moody's Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody's Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to "wholesale clients" within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY'S that you are, or are accessing the document as a representative of, a "wholesale client" and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to "retail clients" within the meaning of section 761G of the Corporations Act 2001. MOODY'S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. ("MJKK") is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody's Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody's SF Japan K.K. ("MSFJ") is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization ("NRSRO"). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

​​​​​​​​