Mexico, December 18, 2012 -- Moody's de Mexico affirmed HSBC Casa de Bolsa, S.A.
de C.V.'s (HSBC CB) long- and short-term
global local currency issuer ratings of A2 and Prime-1, as
well as the entity's long- and short-term Mexican National
Scale ratings of Aaa.mx and MX-1, respectively.
The outlook on all these ratings is stable.
LIST OF RATINGS AFFIRMED WITH STABLE OUTLOOK
The following issuer ratings on HSBC Casa de Bolsa, S.A.
de C.V. were affirmed with stable outlook:
- Long term global local currency issuer rating of A2
- Short term global local currency issuer rating of Prime-1
- Long term Mexican National Scale rating of Aaa.mx
- Short term Mexican National Scale rating of MX-1
RATINGS RATIONALE
In affirming HSBC CB's A2 issuer rating, Moody's considered the
important links that exist between the brokerage house and its sister
bank HSBC Mexico, S.A, as the brokerage house operates
as a line of business complementing the bank's product suit.
These two entities share common infrastructure brand, and staff,
as well as risk management practices and controls.
As a result, HSBC CB's A2 issuer rating, which is aligned
to the bank's deposit rating, reflects Moody's assumptions
that the bank would support the brokerage house indirectly through its
holding Grupo Financiero HSBC. This assessment takes into account
Article 28 of Mexico's law governing financial groups (Ley de Instituciones
de Credito), which determines that a financial group is expected
to provide support to its subsidiaries. This assessment results
in HSBC CB's A2 issuer rating benefiting from eight notches of uplift
from the standalone rating of b1 due solely to Moody's assumption
of parental support.
Moody's b1 standalone credit assessment for HSBC CB reflects the
company's limited franchise value, small size and overall limited
business scope which is centered in investment bank and bond placement
services as well as trading in capital markets on behalf of institutional
clients. HSBC Mexico is a main counterparty of the brokerage house;
as such, its market share and business potential would be fairly
limited, if not for the revenue, business and operational
synergies it derives from being part of the HSBC Group. Nevertheless,
from a risk perspective, HSBC CB bears a low risk profile with revenues
based primarily on fees rather than on riskier proprietary trading.
HSBC CB's is headquartered in Mexico City, Mexico.
As of 30 September 2012, the brokerage house has total assets of
approximately Mx$3.5 billion, shareholders' equity
of Mx$842 million, and net income of Mx$141 million.
Moody's National Scale Ratings (NSRs) are intended as relative measures
of creditworthiness among debt issues and issuers within a country,
enabling market participants to better differentiate relative risks.
NSRs differ from Moody's global scale ratings in that they are not globally
comparable with the full universe of Moody's rated entities, but
only with NSRs for other rated debt issues and issuers within the same
country. NSRs are designated by a ".nn" country modifier
signifying the relevant country, as in ".mx" for Mexico.
For further information on Moody's approach to national scale ratings,
please refer to Moody's Rating Methodology published in October 2012 entitled
"Mapping Moody's National Scale Ratings to Global Scale Ratings".
The principal methodology used in this rating was Global Securities Industry
Methodology published in December 2006. Please see the Credit Policy
page on www.moodys.com.mx for a copy of this methodology.
The period of time covered in the financial information used to determine
the rating is between 31 December 2008 and 30 September 2012 (source:
Moody's and Issuer's Financial Statements).
The sources and items of information used to determine the rating include
2011 and 2012 interim financial statements (source: HSBC Casa de
Bolsa S.A. de C.V. Grupo Financiero HSBC);
year-end 2011 audited financial statements (source: HSBC
Casa de Bolsa S.A. de C.V. Grupo Financiero
HSBC, audited by KPMG CARDENAS DOSAL, S. C.);
financial statements and information on market position (source:
CNBV).
Additional information on Rating Symbols and Definitions, issuer,
lead analyst, ratings history, etc. can be found in
Moody's local website www.moodys.com.mx.
REGULATORY DISCLOSURES
For ratings issued on a program, series or category/class of debt,
this announcement provides relevant regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides relevant regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support provider's credit rating. For provisional ratings,
this announcement provides relevant regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.mx.
A general listing of the sources of information used in the rating process,
and the structure and voting process for the rating committees responsible
for the assignment and monitoring of ratings can be found in the Disclosure
tab in www.moodys.com.mx.
Moody's considers the quality of information available on the rated
entity, obligation or credit satisfactory for the purposes of issuing
a rating.
Moody's adopts all necessary measures so that the information it
uses in assigning a 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.
Please see Moody's Rating Symbols and Definitions on the Rating
Process page on www.moodys.com.mx for further information
on the meaning of each rating category and the definition of default and
recovery.
Please see ratings tab on the issuer/entity page on www.moodys.com.mx
for the last rating action and the rating history. The date on
which some ratings were first released goes back to a time before Moody's
ratings were fully digitized and accurate data may not be available.
Consequently, Moody's provides a date that it believes is
the most reliable and accurate based on the information that is available
to it. Please see the ratings disclosure page on our website www.moodys.com.mx
for further information.
Please see www.moodys.com.mx for any updates on changes
to the lead rating analyst and to the Moody's legal entity that
has issued the rating.
The ratings issued by Moody's de Mexico are opinions regarding the
credit quality of securities and/or their issuers and not a recommendation
to invest in any such security and/or issuer.
David Olivares Villagomez
VP - Senior Credit Officer
Financial Institutions Group
Moody's de Mexico S.A. de C.V
Ave. Paseo de las Palmas
No. 405 - 502
Col. Lomas de Chapultepec
Mexico, DF 11000
Mexico
JOURNALISTS: 001-888-779-5833
SUBSCRIBERS:52-55-1253-5700
Maria Celina Vansetti-Hutchins
MD - Banking
Financial Institutions Group
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Releasing Office:
Moody's de Mexico S.A. de C.V
Ave. Paseo de las Palmas
No. 405 - 502
Col. Lomas de Chapultepec
Mexico, DF 11000
Mexico
JOURNALISTS: 001-888-779-5833
SUBSCRIBERS:52-55-1253-5700
Moody's affirms HSBC Casa de Bolsa's issuer ratings of A2 and Aaa.mx
