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S&P lowers MUFG Bank (Europe)'s ratings following parent's downgrade

S&P Global Ratings downgraded MUFG Bank (Europe) NV's long-term issuer credit rating to A from A+, with a stable outlook.

At the same time, the rating agency affirmed the Dutch lender's A-1 short-term issuer credit rating.

S&P said the downgrade mirrors its lowering of Bank of Tokyo-Mitsubishi UFJ Ltd.'s long-term issuer credit rating to A from A+, mainly based on the agency's view that the parent will continue to increase its overseas exposure to offset erosion of profitability in Japan and that it is expanding exposures to overseas markets that S&P believes have higher economic risk than Japan.

The stable outlook reflects S&P's view that MUFG Bank (Europe) will remain a core entity of the group, the agency said, adding that it expects the unit's role within the group to continue strengthening over the next few years as other existing European entities move under its umbrella.

Mitsubishi UFJ Financial Group Inc. is the ultimate parent company of MUFG Bank (Europe) and Bank of Tokyo-Mitsubishi UFJ.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.