Moodys.com
Close
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 downgrades Fortis Group's ratings after the sale of its main operations

07 Oct 2008
Moody's downgrades Fortis Group's ratings after the sale of its main operations

Paris, October 07, 2008 -- Moody's Investors Service has today announced that it downgraded Fortis SA/NV and Fortis N.V. long term issuer ratings to Baa2 from Baa1, and the ratings were placed under review for possible downgrade. Debt ratings benefiting from subordinated and preferred guarantees from the joint holding companies were downgraded to Baa3 and Ba1 respectively. Certain securities benefiting from joint and several guarantees from the holding companies and Fortis ASR Levensverzkering N.V. were confirmed at Baa3 with a developing outlook. Moody's also downgraded the insurance financial strength rating of Fortis Insurance Company (Asia) Ltd (FICA) to Baa1 from A3, and the backed senior unsecured debt of Fortis Capital (Asia) Ltd, a wholly-owned subsidiary of FICA, to Baa2 from Baa1. These ratings now carry a developing outlook. The Group's CP rating was affirmed at P-2 and placed under review for possible downgrade. Please refer to the ratings list at the end of this press release for full detail.

SUMMARY

The rating actions follow the announcement by the Belgian state of a number of actions with respect to Fortis' Belgium and Luxembourg operations, namely the full acquisition and subsequent sale (75% stake) to BNP Paribas of Fortis' Belgian banking operations and the sale of Fortis Insurance Belgium to BNP Paribas, and the acquisition of 66% of Fortis Bank Luxembourg by BNP Paribas. Fortis also holds a 66% stake in an SPV that will acquire certain structured assets from Fortis' banking operations, with the remaining 34% held by the Belgian state (24%) and BNP Paribas (10%). These transactions are subject to regulatory approvals.

Consequently, the new Fortis Group ("the Group") now consists solely of Fortis' existing international insurance operations (predominantly in Europe and Asia, including Fortis Insurance Company (Asia) Limited, rated Baa1 IFSR), as well as the Group's investment in the structured finance SPV. Furthermore the Group had historically issued various senior and hybrid securities from or guaranteed by the holding companies, then subsequently on-lent to the operating companies, and these obligations remain with the Group as well as the obligations from the operating companies to the Group.

Moody's notes that the holding company ratings should ultimately reflect the combined financial strength of the insurance companies included in Fortis Insurance International, their ability to produce earnings for the benefit of the holding companies, and the holding company's subordinated position from these entities. Therefore, the ratings were placed under review for possible further downgrade, and Moody's mentioned that issuer ratings of Fortis SA/NV and Fortis N.V. could potentially be downgraded to below investment grade ratings at the conclusion of the review.

LIFE INSURANCE

Moody's said that the downgrade of FICA, Fortis Group's life insurance operation in Hong Kong, reflects the weakened level of support to FICA from its parent, which now has a much smaller operation, limited business diversification and weaker financial flexibility. The Baa1 IFSR of FICA now represents the stand-alone financial strength of the company, whose business and financial fundamentals remain solid and has not been materially impacted by the financial turmoil and ownership changes at Fortis Group and its banking operations. The outlook, on the other hand, is developing, reflecting the uncertainty surrounding the strategic direction of FICA under the new ownership structure as well as its relatively short operating history under Fortis Group.

The backed senior debt rating of Fortis Capital (Asia) is one notch lower than the IFSR of FICA, given that the outstanding bonds of Fortis Capital (Asia) are fully and unconditionally guaranteed by FICA and the guarantee is effectively junior to the liabilities of the insurance policyholders.

HOLDING COMPANY RATINGS

Commenting on the holding company ratings, Moody's said that the rating action reflects the holding companies reliance going forwards on earnings from Fortis' international insurance businesses. Moody's notes that the majority of these insurance operations, with the exceptions of UK and Portugal, maintain modest positions in relatively small insurance markets, such that the level and sustainability of earnings from these businesses is likely to be modest in future (EUR181 million net income for 2007, excluding gains on the sale of CaiFor), and the Group's business overall shows a relatively unclear strategic direction. Compared with the diversity and quality of earnings previously available to the holding company, this represents a material change in the holding companies' credit quality, justifying the reduction in the holding companies' issuer ratings to Baa2 from Baa1.

The rating agency notes that Fortis SA/NV and Fortis N.V. will receive over 14 billion in cash (which Moody's expects to be used to repay the Group's existing senior debts), while the hybrid debts which were previously used to provide financing to the various operating companies of the Group are still economically matched by loans to these entities. More negatively, the holding company holds an investment in a structured portfolio, whose ultimate value is still uncertain and is likely to remain so for some time. Overall however, Moody's regards the Group's existing debt securities as having material collateral backing.

INSTRUMENTS BACKED BY FORTIS SA/NV

Moody's also downgraded (senior to Baa2; subordinated to Baa3; preferred to Ba1) and placed under review for possible downgrade all the debt ratings of the securities issued from Fortis Finance N.V., Fortis Hybrid Financing and Fortfinlux S.A . These rating actions follow the rating action taken on the long-term issuer ratings of Fortis SA/NV and Fortis N.V. since all these securities are guaranteed by the holding companies of the Fortis Group. Commenting further on the securities issued by Fortfinlux S.A. (FRESH and MCS) and Fortis Hybrid Financing, the rating agency mentioned that the respective mandatory convertible and junior / preferred status of these securities could imply higher levels of loss as the Fortis Group profile deteriorates, and Moody's review will also consider whether any additional notching is necessary for these junior instruments.

In addition, Moody's has confirmed the Baa3 rating of the securities issued by Fortis Floating Rate Capital Funding Trust, Fortis Fixed Rate Quarterly Capital Funding Trust, Fortis Fixed Rate Annual Capital Funding Trust and Fortis Capital Funding LLP, and assigned a developing outlook to these ratings. This rating action reflects the subordinated guarantee provided by Fortis ASR Levensverzekering N.V. (A3 insurance financial strength rating with a developing outlook) to these securities in addition to guarantees from the holding companies, and the seniority of this guarantee which will rank pari passu with preference shares of the insurance company in case of liquidation.

SHORT-TERM RATING

Moody's rating on the Group's CP (P-2 under review for possible downgrade) reflects the high level of illiquidity of the Group's investments in structured assets as well as the dramatic reduction of recurrent revenues coming from the operating companies following the various divestments. The short-term rating is also a reflection of the Group's long-term ratings. Furthermore, although Moody's acknowledges the current high level of cash available within the holding companies, the ultimate cash position of the Group remains uncertain. The review will be concluded in conjunction with the review of long-term ratings.

DETAILED SUMMARY OF RATING ACTIONS

The following ratings have been downgraded and assigned a developing outlook:

- Fortis Insurance Company (Asia) Limited -- insurance financial strength rating at Baa1 from A3

- Fortis Capital (Asia) Limited -- backed senior unsecured debt rating at Baa2 from Baa1

The following ratings have been downgraded and placed under review for possible downgrade:

- Fortis SA/NV -- long term issuer rating at Baa2 from Baa1

- Fortis N.V. - long term issuer rating at Baa2 from Baa1

- Fortis Finance N.V. -- backed senior unsecured debt rating at Baa2 from Baa1

- Fortis Finance N.V. -- backed senior unsecured MTN debt rating at Baa2 from Baa1

- Fortis Finance N.V. -- backed subordinated MTN debt rating at Baa3 from Baa2

- Fortis Finance N.V. -- backed junior subordinated MTN debt rating at Baa3 from Baa2

- Fortis Hybrid Financing -- backed junior subordinated debt rating at Ba1 from Baa3

- Fortis Hybrid Financing -- backed preferred stock debt rating at Ba1 from Baa3

- Fortfinlux S.A. -- backed junior subordinated debt rating at Ba1 from Baa3

The following rating has been affirmed and placed under review for possible downgrade:

- Fortis Finance N.V. -- backed commercial paper at P-2

The following ratings have been confirmed and assigned a developing outlook:

- Fortis Floating Rate Capital Funding Trust -- backed preferred stock

- Fortis Fixed Rate Quaterly Capital Funding Trust -- backed preferred stock

- Fortis Fixed Rate Annual Capital Funding Trust -- backed preferred stock

- Fortis Capital Funding LLP -- backed preferred stock

The date of the prior rating action on Fortis Group's ratings was on 30 September 2008, when Moody's downgraded Fortis' ratings following the announcement of a capital injection of EUR 11.2 billion in Fortis Bank SA/NV, Fortis Bank Nederland (Holding) and Fortis Bank Luxembourg by the states of Belgium, the Netherlands and Luxembourg.

Headquartered in Brussels, Belgium and in Utrecht, the Netherlands, Fortis Group had total assets of EUR 974.3 billion and reported shareholders' equity (including minority interest) of EUR 30.4 billion as of June 30th 2008.

London
Simon Harris
Managing Director
Financial Institutions Group
Moody's Investors Service Ltd.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Paris
Benjamin Serra
Analyst
Financial Institutions Group
Moody's France S.A.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

No Related Data.
© 2019 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 ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S 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 RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S 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. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S 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 AND MOODY’S 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 OR MOODY’S 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.

CREDIT RATINGS AND MOODY’S 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 the Moody’s 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 OR 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 rating, agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS 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 rating, agreed to pay to MJKK or MSFJ (as applicable) for 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.

​​​​
Moodys.com