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Fitch Ratings-Taipei/Hong Kong-05 February 2012: Fitch Ratings has assigned Taiwan-based Chinatrust Financial Holding Company's (CFHC) upcoming TWD12bn subordinated bonds a National Long-Term rating of 'AA-(twn)' with Rating Watch Negative (RWN).
The company's subordinated bonds are issued through two tranches - seven-year TWD9.6bn and 10-year TWD2.4bn. They carry fixed coupon rates of 1.66% and 1.80% respectively, with maturities on 20 February 2019 and 20 February 2022. The proceeds will be used to refinance maturing preferred shares in December 2012.
The subordinated bonds are rated two notches below CFHC's National Long-Term rating of 'AA+(twn)' to reflect the bonds' loss absorption feature through coupon and principal deferrals if CFHC's capital adequacy ratio falls below the regulatory minimum requirement of 100%. The RWN status reflects the likelihood that the debt rating will be downgraded under Fitch's new criteria. For details, please refer to the criteria report "Rating Bank Regulatory Capital and Similar Securities" dated 15 December 2011 at www.fitchratings.com.
CFHC's ratings are as follows:
- Long-Term Foreign Currency IDR 'A'; Outlook Stable
- Short-Term Foreign Currency IDR 'F1'
- National Long-Term rating 'AA+(twn)'
- National Short-Term rating 'F1+(twn)'
- Viability Rating 'a'
- upport Rating '5'
- Support Rating Floor 'NF'
Contacts:
Primary Analyst
Sophia Chen, CFA, CPA
Director
+886 2 815 7604
Fitch Ratings Limited
Suite 1306, 13F, 205, Tun Hwa N. Rd., Taipei
Secondary Analyst
Jonathan Lee
Senior Director
+886 2 8175 7601
Committee Chairperson
Ananda Bhoumik
Senior Director
+91 22 4000 1720
Media Relations: Wai Lun Wan, Hong Kong, Tel: +852 2263 9935,
Email:
wailun.wan@fitchratings.com.
Note to editors: Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. The best risk within a country is rated 'AAA' and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(twn)' for National ratings in Taiwan. Specific letter grades are not therefore internationally comparable.
Additional information is available at www.fitchratings.com. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.
Applicable criteria "Global Financial Institutions Rating Criteria", dated 16 August 2011, "Rating Bank Regulatory Capital and Similar Securities", dated 15 December 2011 and "National Ratings Criteria", dated 19 January 2011, are available at www.fitchratings.com.
Applicable Criteria and Related Research:
Global Financial Institutions Rating Criteria
Rating Bank Regulatory Capital and Similar Securities
National Ratings Criteria
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