Moody's corrects the long-term counterparty risk assessment of Asia Commercial Bank
Moody's corrects the long-term counterparty risk assessment of Asia Commercial Bank
Moody's Investors Service has corrected the long-term counterparty risk assessment (CR Assessment) of Asia Commercial Bank (ACB) to B2(cr).
RATINGS RATIONALE
The change to the long-term CR Assessment does not impact the B2 long-term deposit and issuer ratings assigned to ACB.
In line with Moody's Banks methodology published in March 2015, ACB's CR Assessment — prior to government support — is positioned one notch above the adjusted BCA of b3. Moody's then applies government support assumptions for the CR Assessment, in line with the same support assumptions as for the long-term deposits and issuer ratings.
For the rating action on 8 October 2015 on ACB, where the BCA of the bank was upgraded to b3 from caa1, the scorecard setting for "dependence" used to model government support for the CR Assessment was positioned incorrectly. The application of the correct "dependence" setting of "very high" in the scorecard for ACB results in a long-term CR Assessment of B2(cr), as opposed to B1(cr) under the incorrect setting. The correction leads to no government support uplift for the CR Assessment.
The principal methodology used in this rating was Banks published in March 2015. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.
REGULATORY DISCLOSURES
For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this rating action, and whose ratings may change as a result of this 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.
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