Moodys.com
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 takes actions on two Qatari banks; concludes review

16 May 2016

Actions follow sovereign rating action

Limassol, May 16, 2016 -- Moody's Investors Service (Moody's) has today concluded its review for downgrade on the ratings of two Qatari banks initiated on 7 March 2016. Moody's has confirmed the long-term deposit ratings of Qatar National Bank ('QNB') at Aa3 with a negative outlook, and downgraded the long-term deposit ratings of The Commercial Bank ('Commercial Bank') to A2 from A1 with a stable outlook.

The rating actions follow Moody's confirmation of Qatar's government issuer rating on 14 May 2016 at Aa2 with a negative outlook, which concluded the review for downgrade of the sovereign rating that was initiated on 4 March 2016. The sovereign action reflects Moody's view that despite the negative effect from a protracted period of low oil prices on the country's economy, government finances and external strength, the sovereign's overall credit profile remains consistent with a Aa2 rating (please see "Moody's confirms Qatar's Aa2 government bond and issuer ratings and assigns negative outlook, concluding review for downgrade" https://www.moodys.com/research/--PR_347447 ).

The confirmation of QNB's ratings is underpinned by the continued capacity and willingness of the government to provide support to the bank in times of stress as indicated by the confirmation of the Aa2 rating. The negative outlook mirrors the negative outlook on the sovereign and captures Qatar's fiscal pressures, which could weaken its capacity to provide support over time. The bank's standalone baseline credit assessment (BCA) of baa1 was not under review for downgrade and remains unchanged.

Moody's downgrade of Commercial Bank's ratings to A2 from A1 is driven by a downgrade of its standalone BCA to baa3 from baa2, which primarily reflects two related sources of pressure: (1) asset quality deterioration stemming from the bank's exposure to the weakening construction and real estate sectors in Qatar, as well as from the challenging Turkish market to which the bank is exposed through a subsidiary; and (2) declining profitability due to elevated provisioning requirements and income volatility related to its international operations. Nevertheless, the stable outlook on the ratings incorporates Commercial Bank's sound and improving capital buffers, which provide strong loss absorption capacity, and high liquidity buffers that partially offset risks relating to the bank's reliance on market funding. Commercial Bank's A2 deposit ratings continue to benefit from the Qatari government's capacity to provide support, as indicated by the confirmation of the government bond rating at Aa2, and Moody's view of a 'very high' willingness of support for the bank.

Please click on this link http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_189944 for the List of Affected Credit Ratings. This list is an integral part of this Press Release and identifies each affected issuer.

RATINGS RATIONALE

QATAR NATIONAL BANK -- RATIONALE FOR THE CONFIRMATION

The primary driver underpinning today's confirmation of QNB's long term ratings is the Qatar's government's continued fiscal capacity to provide support in the event of need, as indicated by the confirmation of its sovereign bond ratings at Aa2 with a negative outlook.

The bank's deposit ratings benefit from Moody's support assumptions, which take into account the willingness and capacity of a government to provide support to banks in times of stress in case of need. The confirmation of the sovereign rating indicates that this capacity currently remains broadly unchanged. In addition, Moody's views on the willingness of government support also remains 'very high' for the bank. This is based on: (1) the bank's dominance and importance to the local financial system with a market share of around 40% in deposits; (2) the government's direct 50% shareholding in the bank; and (3) the demonstrated willingness and ability of the Qatari government to provide support to local banks, through capital injections and the purchase of real-estate and equity investment portfolios from banks.

The bank's standalone baseline credit assessment (BCA) of baa1 was not under review for downgrade and remains unchanged.

RATIONALE FOR THE NEGATIVE OUTLOOK

The negative outlook on the long-term deposit ratings mirrors the negative outlook on the sovereign rating and captures Qatar's fiscal pressures, which may weaken the capacity of the sovereign to provide support over time.

WHAT COULD CHANGE THE RATINGS -- UP/DOWN

Upwards pressure on QNB's supported ratings is limited given the negative outlook on the ratings. A stabilisation of the ratings could develop from a stabilisation of the government bond rating's outlook to stable. Downwards pressure on QNB's ratings could develop from: (1) further lowering of the government bond's ratings that would lead to reduced support capacity and/or a reassessment of willingness of government support; (2) a material deterioration in the banks' operating environment resulting in a weakening in their solvency and liquidity metrics and/or (3) pressures resulting from its expansion into markets more risky than its home jurisdiction.

COMMERCIAL BANK -- RATIONALE FOR THE DOWNGRADE

-- PERSISTENT ASSET QUALITY PRESSURES OWING TO SIZEABLE CONSTRUCTION AND REAL ESTATE EXPOSURES AND SUBSTANTIAL PRESENCE IN WEAKENING TURKISH MARKET

The primary driver for the downgrade of the deposit ratings is the weakening of the bank's standalone credit profile, as indicated by the lowering of its standalone BCA to baa3 from baa2, owing to persistent asset quality pressures stemming from its sizeable construction and real estate exposures domestically, as well as its exposure to the weakening Turkish market. Commercial Bank's asset quality continued to deteriorated in the recent quarters, with non-performing loans (NPLs) growing to 4.1% of loans as of March 2016, compared to 3.8% as of end-2015 and 3.1% as September 2015. This compares unfavourably to the 1.5% average for the Qatari banking system and is above the 1.8% reported by banks with a baa2 global median.

The asset quality deterioration is also driven by Commercial Bank's substantive presence in the weakening environment of Turkey (Baa3, negative) through its subsidiary, Alternatifbank A.S. (Baa3 deposits, ba3 BCA on review for downgrade), which accounted for 15% of group's assets as of end- 2015. The Turkish operating environment remains challenging due to subdued economic growth, political and geopolitical risks, as well as currency volatility. Alternatifbank's loan book has grown rapidly by 20% year-on-year in 2015 and comprised 17% of group's total loans. While the reported NPL ratio in Turkey stood at 4.9% as of end-December 2015, Moody's considers that the unseasoned loan book leaves Commercial Bank exposed to a further increase in problematic exposures in the current environment.

Commercial Bank's asset quality deterioration is also driven by concentrated exposures to a few large borrowers in the contracting, construction and real estate sectors domestically, which face increasing pressure in light of both more selective public spending and tightening market liquidity. Moody's expects the bank's asset quality will remain exposed to further downside risks given its still sizeable exposure to these typically volatile sectors, which although reducing in size, still remains substantial at 37% of loans and 234% of reported Tier 1 capital as of end-2015.

--DECLINING PROFITABILITY OWING TO HIGH PROVISIONING REQUIREMENTS AND INCOME VOLATILITY RELATED TO INTERNATIONAL OPERATIONS

The second driver for the downgrade reflects Commercial Bank's declining profitability owing to elevated provisioning and the weakening performance of its international operations.

Moody's notes that elevated provisioning requirements have dampened the bank's profitability, with net income to banking assets declining to 0.9% in the three months of March 2016, which compares unfavourably with the 1.9% average for the Qatari banking system. Credit costs went up by 52% year-on-year in the three months ending March 2016 and absorbed 51% of pre-provision income. The rating agency expects that provisioning will likely remain elevated as the bank builds further its coverage of NPLs by loans loss reserves, which has improved to 73% as of March 2016.

The pressure on profitability also stems from the volatile contribution of its international operations in the UAE and Turkey of which both are expected to remain under pressure. Commercial Bank's 40% stake in the UAE-based United Arab Bank PJSC (Baa2 deposits on review for downgrade, ba1 BCA) has pressured the group's profitability in 2015 due to the weakening performance of the associate, which had a negative contribution to the group's income (-7%) in FYE2015, compared to 10% contribution in FYE2014. Similarly, Moody's also notes that contribution from the Turkish subsidiary declined materially in 2015 given the severe depreciation of the Turkish Lira in 2015, while in Q1 2016 the subsidiary was loss-making due to asset quality pressures and high provisioning needs.

RATIONALE FOR THE STABLE OUTLOOK

-- SOUND AND IMPROVING CAPITALISATION PROVIDES HIGH LOSS ABSORPTION CAPACITY

Despite the aforementioned pressures, the key driver for the stable outlook is Commercial Bank's sound and improving capital buffers, which provide the bank with a high loss absorption capacity and underpin the ratings at the new level. The bank's capitalization compares well with global peers, with tangible common equity to risk-weighted assets of 14% as of end-2015, well above the 12.7% median for banks with baa3 BCAs. Moody's notes that Commercial Bank's Tier 1 capital ratio was strengthened in Q1 2016, following the successful second issuance of Additional Tier 1 capital which strengthened Tier 1 to 13.9% as of March 2016, from 11.8% as of end-2015.

-- HIGH LIQUIDITY BUFFERS MODERATE RISKS RELATED TO SIGNIFICANT MARKET FUNDING RELIANCE

The stable outlook also takes into account Commercial Bank's high liquidity buffers, with liquid assets comprising 31% of total assets as of March 2016, a ratio that is one of the highest compared to its domestic peers. These buffers help moderate the risks related to the bank's relatively high reliance on confidence-sensitive but long-term market funding, with market funds constituting 21% of banking assets as of March 2016.

-- GOVERNMENT SUPPORT CONTINUES TO UNDERPIN COMMERCIAL BANKS' DEPOSIT RATINGS

Commercial Bank's A2 deposit ratings continue to incorporate four notches of government support uplift from the bank's standalone BCA of baa3. This is based on the Qatari government's continued fiscal capacity to provide support, as indicated by the confirmation of its rating at the Aa2 level, and Moody's views that the willingness of government support for Commercial Bank remains 'very high'. Moody's bases this view on: (1) The bank's importance to the local financial system with a market share of around 10% in deposits; (2) the demonstrated willingness and ability of the Qatari government to provide support to local banks and; (3) the government's 16.7% shareholding in Commercial Bank.

What Could Change the Rating -- Up/Down

Upward pressure on the rating could be exerted following a material improvement in asset quality and profitability metrics and more specifically a reduction in the level of NPLs, reducing exposure to the contracting, construction and real estate sectors while ensuring low level of future impairments. Downward pressure could be exerted if NPLs increase beyond current expectations and impact profitability through high provisioning needs. A weakening in the group's capital and liquidity buffers could also exert pressure on the ratings.

Please click on this link http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_189944 for the List of Affected Credit Ratings. This list is an integral part of this Press Release and provides, for each of the credit ratings covered, Moody's disclosures on the following items:

• Methodologies Used

REGULATORY DISCLOSURES

Please click on this link http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_189944 for the List of Affected Credit Ratings. This list is an integral part of this Press Release and provides, for each of the credit ratings covered, Moody's disclosures on the following items:

• Releasing Office

• Person Approving the Credit Rating

For ratings issued on a program, series or category/class of debt, this announcement provides certain 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 certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain 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.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Elena Panayiotou
Asst Vice President - Analyst
Financial Institutions Group
Moody's Investors Service Cyprus Ltd.
Porto Bello Building
1, Siafi Street, 3042 Limassol
PO Box 53205
Limassol CY 3301
Cyprus
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Sean Marion
Managing Director
Financial Institutions Group
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Releasing Office:
Moody's Investors Service Cyprus Ltd.
Porto Bello Building
1, Siafi Street, 3042 Limassol
PO Box 53205
Limassol CY 3301
Cyprus
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Moody's takes actions on two Qatari banks; concludes review

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.

​​​​​​​​
Moodys.com