Recipient email addresses will not be used in mailing lists or redistributed.
Use semicolon to separate each address, limit to 20 addresses.
characters you see
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
Don't want to see this again?
Accept our to continue to Moodys.com:
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 information 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
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.
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
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.
23 May 2003
MOODY'S RATES DBS ASSET MANAGEMENT'S SYNTHETIC CDO DEAL Aaa
US$95 Million of Asset-Back Securities Rated.
Hong Kong, May 23, 2003 -- Moody's Investors Service assigned its long-term Aaa credit rating
to the Class A floating rate mezzanine notes issued by Merlion CDO 1 Limited.
At the same time, Moody's assigned a Aa2 rating to the Class B floating
rate mezzanine notes, an A2 rating to the Class C floating rate
mezzanine notes and a Baa2 rating to the Class D floating rate mezzanine
notes. The current transaction is a managed synthetic collateralised
debt obligation transaction and has been brought to market jointly by
J.P. Morgan (S.E.A.) Limited and The
Development Bank of Singapore Limited. Moody's did not rate the
US$30 million subordinated notes. The complete rating action
is as follows:
Issuer: Merlion CDO 1 Limited
US$50,000,000 Class A Floating Rate Mezzanine Notes
due 2010, rated Aaa
US$15,000,000 Class B Floating Rate Mezzanine Notes
due 2010, rated Aa2
US$10,000,000 Class C Floating Rate Mezzanine Notes
due 2010, rated A2
US$20,000,000 Class D Floating Rate Mezzanine Notes
due 2010, rated Baa2
The ratings are based upon, among other things, the following:
1. the credit quality of the underlying reference entities;
2. the diversity among the underlying reference entities;
3. the CDS premiums payable to the issuer by JPMorgan Chase Bank,
London branch (Aa3/P-1 for its head office rating) (JPM) as the
credit default swap counterparty;
4. the credit quality of the collateral securities --
US$125 million Oeffentlicher Pfandbriefe due June 4, 2010
and issued by Landesbank Baden-Württemberg (Aaa/P-1);
5. the credit quality of The Development Bank of Singapore Limited
(Aa2/P-1) (DBS) as the collateral securities forward counterparty;
6. the credit quality of JPM as the asset swap counterparty;
6. the loss allocation arrangement in the credit default swaps
7. the experience of DBS Asset Management Ltd (DBSAM) as the portfolio
8. the legal and structural integrity of the transaction.
Although the scheduled maturity date of the notes is in June 2010,
owing to the potential delay in principal redemption on the notes due
to the settlement mechanism in the CDS, the ratings assigned address
the timely payments of interest on or before the scheduled maturity date
in June 2010 and the ultimate principal payment of the notes at par by
the legal final maturity date in November 2010.
Moody's ratings only address the credit risks associated with the transaction.
Other non-credit risks, such as those associated with the
timing of principal prepayments, have not been addressed and they
may have a significant impact on the yield to investors.
In this transaction, the issuer used the US$95 million rated
notes proceeds and the US$30 million unrated subordinated notes
proceeds to acquire US$125 million Oeffentlicher Pfandbriefe due
June 4, 2010 issued by Landesbank Baden-Württemberg
(Aaa/P-1). To address the interest rate mismatch between
the notes and the collateral securities and the potential market value
risk in liquidating the collateral securities under the early redemption
of the notes, the issuer entered into an asset swap and a collateral
securities forward agreement with JPM and DBS respectively.
In addition to the collateral securities, the issuer also entered
into one hundred CDS with JPM as of the closing date. Each CDS
is referenced to one reference entity with a notional amount of US$10
million. Under the CDS, the issuer sells credit protection
to JPM. The issuer will, in turn, receive a quarterly
CDS premium from JPM for each of the CDS. If credit event occurs
in relation to a reference entity, the issuer is obligated to pay
a cash settlement amount to JPM on the scheduled maturity date under the
CDS. Such cash settlement amount will be determined at the completion
of a bid quotation process.
The issuer has appointed DBSAM as the portfolio manager of the transaction.
Subject to certain trading and portfolio criteria, DBSAM is authorised
to terminate existing CDS or to enter into new CDS on behalf of the issuer
with JPM as the credit default swap counterparty. The issuer will
book all the CDS trading gain/loss arising from the termination and/or
addition of CDS and settle the net amount with JPM on the scheduled maturity
date in accordance with the payment waterfall.
Cash settlement amounts and net trading loss will first be absorbed by
the subordinated note investors. When the aggregate of all the
cash settlement amounts and net trading loss exceeds US$30 million,
any additional loss will then be allocated to the mezzanine note investors
on a sequential basis according to reverse seniority order of the notes
with Class A notes as the most senior class. The maximum amount
of loss allocated to each class of notes will be capped at their respective
initial principal amount.
Interest on the notes is payable quarterly and is calculated based on
the outstanding principal balance of each class of the notes. The
issuer will write down the outstanding principal balance of the relevant
class of notes by an amount equal to the cash settlement amount allocated
to such class of notes during the term of the transaction on each payment
date. To the extent when the actual cash settlement amount of the
reference entity which has triggered a credit event has not been finalised
as of the payment date, for the purpose of calculating the interest
amount payable to the noteholders, the to-be-determined
cash settlement amount will be deemed to be equal to the notional amount
of such reference entity. When the actual cash settlement amount
is subsequently determined, the outstanding principal balance of
the notes will be adjusted accordingly. Meanwhile, an additional
interest amount --- equal to the difference between
the interest actually paid to the noteholders and the interest that would
have been paid to the noteholders --- will then be
payable by the issue to the respective noteholders.
Principal redemption of the notes is expected to be on the scheduled maturity
date in June 2010. However, if there are any unsettled credit
events as of the scheduled maturity date, a portion of the principal
repayment of the notes will then be withheld until the actual cash settlement
amount is determined. The last principal redemption of the notes
is expected to be paid out on or before the legal final maturity date
on November 21, 2010.
A more detailed analysis of the transaction will soon be available at
Moody's web site in the New Issue Reports section: http://www.moodys.com.
The issuer is a special-purpose, bankruptcy-remote
company recently incorporated in the Cayman Islands. DBSAM is the
portfolio manager of the transaction. DBSAM, a wholly owned
subsidiary of Development Bank of Singapore Limited, was incorporated
in Singapore in 1982 and was authorised under the Monetary Authority of
Singapore as an investment management company. As at March 31,
2003, DBSAM had approximately S$6 billion of assets under
management. DBSAM manages both fixed income and equity products,
with particular expertise in global fixed income and Asian equities.
Moody's Investors Service is a publisher of rating opinions and research.
It is not involved in the offering or sale of any securities, nor
is it acting on behalf of the offering party. This release is not
a solicitation or a recommendation to buy, hold or sell securities.
Michael M. Ye
Structured Finance Group
Moody's Asia Pacific Ltd.
Vice President - Senior Analyst
Structured Finance Group
Moody's Asia Pacific Ltd.
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.