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Moody's assigns 1st-time ratings to Bank of Tokyo-Mitsubishi UFJ (China)

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Moody's assigns 1st-time ratings to Bank of Tokyo-Mitsubishi UFJ (China)

Moody's assigned an A3 long-term and P-2 short-term local-currency and foreign-currency deposit ratings to Bank of Tokyo-Mitsubishi UFJ (China) Ltd.

The rating agency said it also assigned the bank a "ba1" baseline credit assessment, "a3" adjusted baseline credit assessment and A2(cr)/P-1(cr) counterparty risk assessment.

The outlook is stable and in line with that of the bank's parent, Bank of Tokyo-Mitsubishi UFJ Ltd.

Moody's said the bank's baseline credit assessment reflects the lender's good asset quality metrics and strong capitalization, as well as its wholesale and corporate banking focus, relatively high loan concentration and its weaker-than-peer average profitability. The bank's A3 deposit rating takes into account four notches of affiliate support uplift and strong support from its parent.

The rating agency could upgrade the lender's baseline credit assessment if China's macroeconomic conditions improve and if the bank maintains its sound financial metrics and improves its diversification.

However, the bank's baseline credit assessment could experience downward pressure if the operating environment in China deteriorates significantly or if the bank's capitalization weakens significantly, among other factors.

Moody's could also upgrade or downgrade the bank's ratings if it makes a similar action on the parent company's ratings.