Friday 29 Mar 2024
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KUALA LUMPUR (Jan 27): Moody's Investors Service has assigned a (P)A3 foreign currency senior unsecured rating to the samurai shelf registration of Malayan Banking Bhd (Maybank, A3 stable, a3).

On the rating's rationale, the agency in a statement Thursday (Jan 27) said according to the terms and conditions available to Moody's, the notes to be issued under the shelf registration will constitute direct, unconditional and unsecured obligations of Maybank (the issuer), will rank pari passu among themselves and at least pari passu in right of payment with all other present and future unsecured obligations of the bank.

“Therefore, the shelf registration's rating is positioned at the same level as Maybank's existing senior unsecured debt rating of A3.

“The shelf registration was filed under the Japanese shelf registration process in June 2020,” it said.

Moody’s said the total amount of new securities that can be issued under the shelf registration is ¥500 billion (RM18.34 billion).

Maybank's A3 long-term senior unsecured ratings are based on its a3 baseline credit assessment (BCA).

The ratings do not benefit from any uplift from government support, given the bank's BCA is already at the same level as the government of Malaysia's rating (A3 stable).

Maybank's a3 BCA considers risks to its asset quality because of the economic impact of the coronavirus pandemic in its key operating markets.

The bank's strong capital and traditional strengths of sound funding and liquidity supported by its dominant franchise in Malaysia will offset the strain.

Moody’s said the rating on the shelf registration is in line with Maybank's foreign currency deposit rating, which is at the same level as Malaysia's A3 sovereign rating.

It said given the stable outlook on the sovereign rating, an upgrade of Maybank's long-term ratings is unlikely in the next 12-18 months.

Moody's said it could downgrade Maybank's long-term ratings and the rating on the shelf registration if the bank's standalone credit profile materially deteriorates.

At 9.45am, Maybank added one sen to RM8.31, valuing it at RM98.71 billion.

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