Downside risks will dominate Asia-Pacific banking for the remainder of 2020. Recoveries to pre-COVID-19 levels will likely be slow and uncertain, as in other regions. We have already negatively revised the economic or industry trends underpinning the financial strength of many banking jurisdictions globally; and we expect this negative trend will persist. We have taken 337 negative rating actions on financial institutions globally to Oct. 13, 2020, since the onset of the pandemic. Our outlooks for about one in five financial institutions in Asia-Pacific are currently negative. We believe this negative theme will likely stay in play for the rest of 2020.
We anticipate much uncertainty on the recovery pathway. A banking sector revival will not just depend on the economic recovery occurring broadly in accordance with our base case (see "Asia-Pacific's Recovery: The Hard Work Begins," published Sept. 24, 2020). Also key is the nature and extent of the economic damage affecting firms and households prior to the onset of the economic recovery, and the extent to which this will hit banks.
China, South Korea, Singapore, and Hong Kong may be among the first in Asia-Pacific to recover to 2019 financial strength; but not until the end of 2022. We assume it will take this long to work through asset quality problems even in the case for China, the only major economy globally for which we assume positive GDP growth in 2020, and where COVID-19 infections are low. For the Chinese banking system we estimate that credit losses will increase by about US$370 billion to the end of 2021 because of COVID-19 (see "China's Economic Recovery Could Reduce Bad Loans Risk," published Oct. 15, 2020, and "The $2 Trillion Question: What's On The Horizon For Bank Credit Losses," published July 9, 2020).
Australia, Japan, and Indonesia may be among those to recover next; by year-end 2023. In Japan, we have taken 16 bank rating actions to Oct. 13, 2020, since the onset of COVID-19 encompassing major banks, regional banks, and government-related financial institutions. Sovereign- and bank-specific rating factors drove these actions.
We expect that the recovery of the Indian banking sector will not arrive until beyond 2023. Our negative rating actions on Indian banks and nonbank financial institutions were prompted by deteriorating operating conditions through the pandemic, noting that the Indian banking sector entered the pandemic with an overhang of high nonperforming assets.
For a discussion of the shape of the recovery for major banking systems globally, see "Global Banking: Recovery Will Stretch To 2023 And Beyond," published Sept. 23, 2020.
The Worst Of The Pandemic-Driven Economic Turmoil May Have Passed
The pandemic is not over but the worst of its economic impact may have passed. As relief measures taper and the credit impulse wanes, the true economic costs of COVID-19 will emerge. We expect Asia-Pacific to shrink by 2% in 2020 and rebound by about 7% next year leaving the region almost 5% below the pre-COVID trend by end 2021. We recently revised down our GDP growth prospects for 2020 for numerous Asia-Pacific economies, including Hong Kong, India, Indonesia, Japan, Malaysia, Philippines, Singapore, and Thailand (see table 1).
We revised up China's 2020 GDP estimate, given its quicker path to normalization thus far. That said, its recovery is not yet self-sustaining. The country's potentially harder turn toward self-reliance, in response to geopolitical tensions, would move the economy closer to our downside medium-term growth scenario (see "Economic Research: Asia-Pacific's Recovery: The Hard Work Begins," published Sept. 24, 2020).
Risks Emanating From U.S.-China Strategic Confrontations Worsening
The multifaceted confrontation between the U.S. and China is increasing the risk of a financial market or policy reaction that results in material economic costs. Recent U.S. policies and initiatives are increasingly targeting China and the activities of Chinese entities. This could create significant business disruptions if their implementation is more severe. We believe the strained relationship between the economic giants could place additional pressure on economic and credit conditions in these two regions, and beyond (see "Economic Risks Rise As U.S.-China Disputes Heat Up," published Aug. 25, 2020).
Hong Kong is caught between these escalating U.S.-China tensions. Its financial institutions face potential sanctions under the U.S. Hong Kong Autonomy Act (HKAA) and Trump's related executive order. The HKAA was passed in response to China's implementation of a National Security Law in July 2020. For financial institutions operating in Hong Kong, sanction risk adds another layer of uncertainty on top of the pandemic, social unrest, and loss of its special trading status with the U.S. That said, we believe the probability of severe sanctions is very low, although their impact would be high if imposed (see "Credit FAQ: What Is The U.S. Sanction Risk For Banks Operating In Hong Kong?" published Sept. 17, 2020).
Economic Risks Are Increasing In Thailand And The Philippines
In August 2020, we took various negative actions on Thai banks. We now see a one-in-three possibility that economic risks facing the Thai banking system will increase. In our view, Thai banks' asset quality is set to deteriorate, credit losses to rise, and profitability to decline amid a sharp economic recession (see "Various Rating Actions Taken On Thai Banks On Rising Economic Weakness," published Aug. 24, 2020).
Likewise, the economic risk trend for banks operating in the Philippines has turned negative, in our view, causing us to revise our rating outlooks on two Philippine banks to negative (see "Bank of the Philippine Islands, Security Bank Outlooks Revised To Negative On Rising Economic Risks; Ratings Affirmed," published Oct. 12, 2020). We believe the risk of credit losses soaring for Philippine banks is higher than we previously expected, given our view that the economy will contract 9.5% in 2020, compared to our earlier forecast of a 3% dip. In our opinion, weak economic activity and tough employment conditions will dilute the Philippine banking sector's asset quality, earnings, and capitalization over the next two years. In our base case, credit costs (the ratio of provisions for bad loans to total loans) will stay elevated at 1.5%-2.0% in 2020 and 2021. We estimate nonperforming assets (including restructured loans) for the sector could rise to 5.5%-7.5% of total loans, from 4.6% as of August 2020.
After The 2019 Peak, We Expect Capital Ratios To Dip
S&P Global Ratings has updated its risk-adjusted capital (RAC) ratios in its annual capital review for the world's top 100 rated banks (see "Top 100 Banks: COVID-19 To Trim Capital Levels," published Oct. 7, 2020). This year's review indicates that the RAC ratios of the top 100 banks improved slightly in 2019 compared with those in 2018. The average RAC ratio ticked up to 9.0% in 2019 from 8.8% for the prior year.
However, the asset quality and revenue deterioration stemming from COVID-19 will hit internal capital generation. At the same time, banking regulators across the globe have encouraged banks to continue to lend to their customers by loosening capital requirements and minimum buffers. As such, we expect the average RAC ratio to weaken in 2020 to about 8.7% and stabilize in 2021. However, we believe there are material downside risks to our base-case assumptions, and consequently, to our RAC projections. This constitutes one of the factors behind the large proportion of negative outlooks we have assigned to banks (30% of the top 100).
The outlook for RAC across Asia-Pacific is slightly lower for many Top 100 banks. RAC ratios on Chinese banks in the Top 100 are weaker than average among the top 100 banks due mainly to higher risk weights on domestic banks' assets than those of their peers in the sample. Australia is one of the few systems where we don't expect a weakening in major banks' RAC ratios in 2020 and beyond. These institutions retain, in our view, sizeable headroom in their earnings to absorb the likely increase in credit losses and contraction in interest spreads and fee income.
Tech Adoption Continues To Accelerate In The Region
Major banks in Thailand will likely increase their already substantial investments in technology and innovation over the coming few years to remain competitive and to cater to the evolving preferences of an increasingly more digital-savvy customer (see "Tech Disruption In Retail Banking: Agile Thai Banks Have An Upper Hand," published Aug. 26, 2020). Similarly, in Korea, tech-savvy consumers and increasing digital transactions amid the pandemic are incentivizing banks to augment their digital transformation. We believe Korean banks will likely hold their ground against tech disruption given their fast adoption of new technology (see "Tech Disruption In Retail Banking: Korean Banks Accelerate Digital Transformation," published July 31, 2020). Meanwhile, the digital progress of banks in Taiwan has lagged most key markets in the region. Slow fintech deregulation, low systemwide profitability, and a conservative organizational culture have long stifled the sector's digital transformation (see "Tech Disruption In Retail Banking: Digitalization Will Divide Taiwan Banks," published July 31, 2020).
The Philippines is also taking a step toward a digital revolution with virtual bank regulations in the works. Youthful demographics, a large untapped market, low costs, and regulatory latitude will all help the early entrants. And S&P Global Ratings believes the incumbent banks may have to make aggressive moves to hold off online rivals. The large banks we rate should retain their market share over the next three to five years supported by their strong brand recognition and longstanding customer relationships, however (see "Philippine Banks On The Cusp Of A Digital Revolution," Sept. 10, 2020).
China's Sizable TLAC Funding Gap Continues To Grow
This year, China passed the halfway mark in its 10-year timetable to meet international standards on "too big to fail" banking risks. The regulator recently released draft rules on total loss-absorbing capacity (TLAC) for its four globally systemically important banks (G-SIBs). The country's "Big Four" banks have no later than Jan. 1, 2025, to bolster their TLAC, or the type of capital and debt meant to protect public finances when major banks suffer crises.
Chinese G-SIBs must meet global TLAC capital requirements of 16% of risk-weighted assets (RWA) by Jan. 1, 2025, and 18% by Jan. 1, 2028. This is in addition to a 3.5%-4% capital surcharge, comprised of a higher loss-absorbency requirement (1.0%-1.5%) for G-SIBs and capital conservation buffer (2.5%) for Chinese banks. This renders a total regulatory and TLAC capital requirements of 19.5%-20% RWA in 2025 and 21.5%-22% RWA in 2028. As a comparison, the Big Four banks' capital adequacy ratios were between 15.59%-17.52% as of Dec. 31, 2019. Using end-2019 financial results, we estimate the TLAC capital shortage was Chinese renminbi (RMB) 2.25 trillion (US$323 billion), reflecting the sheer size of China's four largest banks. The gap is set to widen because RWA has been expanding faster than internally generated capital, a trend that will be amplified by profit hits due to COVID. By our estimates, RWA will grow at a rate of high-single-digit to low-teens. We project the capital gap could more than double, to RMB5.77 trillion-RM6.51 trillion by 2024, without considering new capital fundraising (see "Credit FAQ: How Are China’s Big Four Banks Addressing The RMB6 Trillion TLAC Gap?" published Aug. 26, 2020; and "Chinese Government Remains Highly Supportive Of Large Banks Despite Introducing TLAC Rules," published Oct. 15, 2020).
ESG Risks--An Increasing Focus For Investors
We consider that environmental, social, and technology risks globally are elevated, and that this risk is worsening (see "Global Credit Conditions: The K-Shaped Recovery," published Oct. 6, 2020). In the financial services arena, we note that early signs of a green or sustainability-linked hybrid capital market for banks and insurers highlights the emerging importance of ESG factors for investors (see "The Greening Of Financial Services: Challenges For Bank And Insurance Green And Sustainability Hybrids," published Aug. 12, 2020).
S&P Global Ratings acknowledges a high degree of uncertainty about the evolution of the coronavirus pandemic. The current consensus among health experts is that COVID-19 will remain a threat until a vaccine or effective treatment becomes widely available, which could be around mid-2021. We are using this assumption in assessing the economic and credit implications associated with the pandemic (see our research here: www.spglobal.com/ratings). As the situation evolves, we will update our assumptions and estimates accordingly.
|Real GDP Forecast|
|Change from June 2020 forecast (ppt)|
|(% year over year)||2019||2020||2021||2022||2023||2020||2021|
|Note: For India, the year runs April to following March, e.g., 2019--fiscal 2019/2020, ending March 31, 2020. ppt--percentage point. Source: Economic Research: Asia-Pacific's Recovery: The Hard Work Begins, Sept. 24, 2020.|
Key Banking Sector Risks
The table below presents S&P Global Ratings' views about key risks and risk trends for banking sectors in Asia-Pacific countries where we rate banks. For more detailed information, please refer to the latest Banking Industry Country Risks Assessment (BICRA) on a given country. According to our methodology, BICRAs fall into groups from '1' to '10', ranging from what we view as the lowest-risk banking systems (group '1') to the highest-risk (group '10').
Banking Sector Research
- China's Economic Recovery Could Reduce Bad Loans Risk, Oct. 15, 2020
- Chinese Government Remains Highly Supportive Of Large Banks Despite Introducing TLAC Rules, Oct. 15, 2020
- Bank of the Philippine Islands, Security Bank Outlooks Revised To Negative On Rising Economic Risks; Ratings Affirmed, Oct. 12, 2020
- Global Credit Conditions: The K-Shaped Recovery, Oct. 8, 2020
- Australian Banks Poised For A Slow And Long Recovery, Oct. 8, 2020
- Top 100 Banks: COVID-19 To Trim Capital Levels, Oct. 7, 2020
- Global Credit Conditions Point To K-Shaped Recovery, Oct. 6, 2020
- Credit Conditions Asia-Pacific: Recovery Roads Diverging, Sept. 29, 2020
- European Bank Funding Access And LIBOR Transition Are Progressing Well, Conference Reports Say, Sept. 29, 2020
- COVID-19 Complicates A Full Agenda For European Banks, Conference Reports Say, Sept. 28, 2020
- Resolution Regimes And Financial Institutions: Research By S&P Global Ratings, Sept. 28, 2020
- Banking Industry Country Risk Assessment Update: September 2020, Sept. 25, 2020
- Global Banking: Recovery Will Stretch To 2023 And Beyond, Says Report, Sept. 23, 2020
- Credit FAQ: What Is The U.S. Sanction Risk For Banks Operating In Hong Kong? Sept. 17, 2020
- China's $420 Billion Small-Loan Push Puts Policy Before Profit, Sept. 15, 2020
- Philippine Banks On The Cusp Of A Digital Revolution, Sept. 10, 2020
- Research Update: AMP Group Ratings Lowered On Strategic Challenges; Outlook Stable, Sept. 7, 2020
- The ESG Pulse: The Search For A Vaccine, Sept. 1, 2020
- Bulletin: Agricultural Bank of China's Fundamentals Resilient Despite Weak Q2, Sept. 1, 2020
- Bulletin: Bank Of China Resilient Amid Macro Uncertainties, Sept. 1, 2020
- Bulletin: ICBC Is Navigating COVID-19 Risks, Sept. 1, 2020
- Bulletin: China Construction Bank's Capitalization Can Absorb Surge In Provisions, Sept. 1, 2020
- Credit FAQ: How Are China’s Big Four Banks Addressing The RMB6 Trillion TLAC Gap? Aug. 26, 2020
- Tech Disruption In Retail Banking: Agile Thai Banks Have An Upper Hand, Aug. 26, 2020
- Economic Risks Rise As U.S.-China Disputes Heat Up, Aug. 25, 2020
- Various Rating Actions Taken On Thai Banks On Rising Economic Weakness, Aug. 24, 2020
- Bulletin: Risks Remain For AMP Amid Board And Executive Changes, Aug. 24, 2020
- Bulletin: Bank Mandiri's First-Half Results Highlight Tough Operating Conditions For Indonesian Banks, Aug. 19, 2020
- Bulletin: AMP Earnings Hit By COVID-19, Aug. 13, 2020
- Environmental, Social, And Governance: The Greening Of Financial Services: Challenges For Bank And Insurance Green And Sustainability Hybrids, Aug. 12, 2020
- Bulletin: Commonwealth Bank of Australia Shows Resilience To COVID-19, Aug. 12, 2020
- Tech Disruption In Retail Banking: Korean Banks Accelerate Digital Transformation, July 31, 2020
- Tech Disruption In Retail Banking: Digitalization Will Divide Taiwan Banks, July 31, 2020
- Bulletin: Standard Chartered Stays Resilient In Tough Environment, July 30, 2020
- Korea's Major Commercial Banks Resilient In Face Of COVID-19, July 29, 2020
- The ESG Pulse: Social Factors Could Drive More Rating Actions As Health And Inequality Remain In Focus, July 16, 2020
- Industry Report Card: Top 60 Asia-Pacific Banks: COVID-19 Drives Downside Risks As Credit Losses Jump And Earnings Fall, July 15, 2020
- India Banks Boost Capital For Rocky Times, July 15, 2020
- The $2 Trillion Question: What's On The Horizon For Bank Credit Losses, July 9, 2020
- Global Banks Outlook Midyear 2020: A Series Of Reports Look At The Profound Implications Of The COVID-19 Shock, July 9, 2020
- Global Sukuk Market: A Window Of Opportunity Is Opening, July 7, 2020
- The Future Of Banking: Building A Token Collection, July 1, 2020
Economic, Sovereign, And Other Research
- Economic Research: A Double-Digit Rebound Has Begun, But It's No Time To Celebrate, Oct. 6, 2020
- Shock And Ore: Surging Debt To Test Australian States, Sept. 30, 2020
- Economic Research: Asia-Pacific's Recovery: The Hard Work Begins, Sept. 24, 2020
- Economic Research: China's Energy Transition Stalls Post-COVID, Sept. 22, 2020
- India's Economy Likely To Tank 9% Due To COVID, Sept. 14, 2020
- Checks And Imbalances: Delayed Australian State Government Budgets Will Embrace More COVID-19 Stimulus, Sept. 7, 2020
- Economic Research: China's Rate Rise Puts Recovery At Risk, Aug. 18, 2020
- Economic Research: Nowcasting In Times Of Crisis: How We Are Tracking The COVID-19 Recovery, July 23, 2020
- Economic Research: China's Deflating Recovery Still Needs Stimulus, July 21, 2020
- Economic Research: Hong Kong's Trend Growth To More Than Halve By 2030, July 20, 2020
Ratings Methodology News
- Guidance | Criteria | Financial Institutions | Other: Alternative Investment Funds Methodology, Jan. 13, 2020
- Criteria | Financial Institutions | Other: Alternative Investment Funds Methodology, Jan. 13, 2020
Webcasts: Asia-Pacific Banking Insights
In the last quarter, we have held the following webcasts to share our views on Asia-Pacific and other banking topics. The replays are available on https://www.spglobal.com/ratings/en/events/webcast-replays/index#
- Webinar Replay: Global Credit Conditions - Shape of Recovery (APAC Session), Oct. 6, 2020
- Tuesday Asia-Pacific Credit Focus: Shape of Recovery - September 22, Sept. 22, 2020
- How Are China's Big Four Banks Addressing The RMB6 Trillion TLAC Gap, Sept. 9, 2020
- Webinar Replay: How Resilient Is Taiwan Banking Sector To COVID-19? Sept. 2, 2020
- APAC FI Monitor Q3 2020: Recession Risks Weigh On Banking Prospects, Aug. 12, 2020
- Webinar Replay: S&P Global Ratings LIVE: ESG – The New Differentiator, July 9, 2020
- Webinar Replay: Impact Of COVID-19 On The South Korea Sovereign, Economy, Financial Institutions & Insurers, July 8, 2020
- Webinar Replay: Kookmin Bank US$7 Billion Global Covered Bond Program Assigned Preliminary 'AAA' Rating; Outlook Stable, July 3, 2020
- Webinar Replay: COVID-19 And Indian Banks: One Step Forward, Two Steps Back, July 3, 2020
- Webinar Replay: Global Credit Conditions 2020 - Shape Of Recovery (APAC), July 2, 2020
- Webinar Replay: Malaysia - Fiscal And Debt Risks Reflect Impact Of COVID-19, July 1, 2020
Over the past quarter (to Sept. 25, 2020), we made the following changes to our Banking Industry Country Risk Assessments (BICRAs):
We revised our economic risk trend for Thailand to negative from stable. We now see a one-in-three possibility that economic risks facing the Thai banking system will increase. This could occur if the already high corporate and household leverage rises sharply such that imbalances in the system heighten. It could also occur if the banking system's asset quality and financial performance deteriorate beyond our current expectations.
Papua New Guinea
We have discontinued our BICRA for Papua New Guinea, since we no longer maintain public ratings on any bank based in the country.
|Issuer Credit Ratings And Component Scores For The Top 60 Asia-Pacific Banks|
|Institution||Opco L-T ICR/outlook||Anchor||Business position||Capital and earnings||Risk position||Funding and liquidity||SACP or Group SACP||Type of support||No. of notches of support||Additional factor adjustment|
|Australia and New Zealand Banking Group Ltd.||AA-/Negative||bbb+||Strong||Strong||Adequate||Avg/Adequate||a||Sys. Imp.||2||0|
|Commonwealth Bank of Australia||AA-/Negative||bbb+||Strong||Strong||Adequate||Avg/Adequate||a||Sys. Imp.||2||0|
|Macquarie Bank Ltd.||A+/Negative||bbb+||Adequate||Strong||Adequate||Avg/Adequate||a-||Sys. Imp.||2||0|
|National Australia Bank Ltd.||AA-/Negative||bbb+||Strong||Strong||Adequate||Avg/Adequate||a||Sys. Imp.||2||0|
|Westpac Banking Corp.||AA-/Negative||bbb+||Strong||Strong||Adequate||Avg/Adequate||a||Sys. Imp.||2||0|
|Agricultural Bank of China Ltd.||A/Stable||bb+||Very Strong||Adequate||Adequate||Above Avg/Strong||bbb+||GRE||2||0|
|Bank of China Ltd.||A/Stable||bbb-||Very Strong||Adequate||Adequate||Above Avg/Strong||a-||GRE||1||0|
|Bank of Communications Co. Ltd.||A-/Stable||bb+||Strong||Adequate||Adequate||Above Avg/Adequate||bbb-||GRE||3||0|
|China CITIC Bank Co. Ltd.||BBB+/Stable||bb+||Adequate||Weak||Adequate||Avg/Adequate||bb||Group||4||0|
|China Construction Bank Corp.||A/Stable||bb+||Very Strong||Adequate||Adequate||Above Avg/Strong||bbb+||GRE||2||0|
|China Merchants Bank Co. Ltd.||BBB+/Stable||bb+||Strong||Moderate||Strong||Above Avg/Adequate||bbb||Sys. Imp.||1||0|
|China Minsheng Banking Corp. Ltd.||BBB-/Stable||bb+||Adequate||Weak||Adequate||Avg/Adequate||bb||Sys. Imp.||2||0|
|Hua Xia Bank Co. Ltd.||BBB-/Stable||bb+||Adequate||Moderate||Moderate||Avg/Adequate||bb||GRE||2||0|
|Industrial and Commercial Bank of China Ltd.||A/Stable||bb+||Very Strong||Adequate||Adequate||Above Avg/Strong||bbb+||GRE||2||0|
|Postal Savings Bank Of China Co. Ltd.||A/Stable||bb+||Strong||Moderate||Adequate||Above Avg/Strong||bbb||GRE||3||0|
|Shanghai Pudong Development Bank Co. Ltd.||BBB/Stable||bb+||Adequate||Weak||Adequate||Avg/Adequate||bb||GRE||3||0|
|Bank of China (Hong Kong) Ltd.||A+/Stable||bbb+||Strong||Strong||Adequate||Above Avg/Strong||a+||Sys. Imp.||1||-1|
|Standard Chartered Bank (Hong Kong) Ltd.||A+/Stable||bbb+||Adequate||Strong||Adequate||Above Avg/Strong||a||Sys. Imp.||1||0|
|The Bank of East Asia Ltd.||A-/Stable||bbb+||Adequate||Adequate||Adequate||Avg/Adequate||bbb+||Sys. Imp.||1||0|
|The Hongkong and Shanghai Banking Corp. Ltd.||AA-/Stable||bbb+||Strong||Strong||Adequate||Above Avg/Strong||a+||Sys. Imp.||1||0|
|Axis Bank Ltd.||BB+/Stable||bb+||Strong||Adequate||Moderate||Avg/Adequate||bb+||None||0||0|
|Bank of India||BB+/Stable||bb+||Adequate||Moderate||Weak||Above Avg/Strong||bb||GRE||1||0|
|HDFC Bank Ltd.||BBB-/Stable||bb+||Strong||Adequate||Strong||Above Avg/Strong||bbb+||None||0||-2|
|ICICI Bank Ltd. §||BBB-/Negative||bb+||Strong||Strong||Moderate||Avg/Adequate||bbb-||None||0||0|
|State Bank of India||BBB-/Stable||bb+||Strong||Moderate||Moderate||Above Avg/Strong||bbb-||None||0||0|
|PT Bank Mandiri (Persero)||BBB-/Negative||bb+||Strong||Strong||Moderate||Avg/Strong||bbb-||None||0||0|
|PT Bank Rakyat Indonesia (Persero) Tbk.||BBB-/Negative||bb+||Strong||Strong||Moderate||Avg/Strong||bbb-||None||0||0|
|Chiba Bank Ltd.||A-/Stable||bbb+||Adequate||Adequate||Strong||Avg/Strong||a-||None||0||0|
|Mitsubishi UFJ Financial Group Inc.*||A/Stable||bbb+||Strong||Adequate||Adequate||Above Avg/Strong||a||None||0||0|
|Mizuho Financial Group Inc.*||A/Stable||bbb+||Strong||Adequate||Adequate||Above Avg/Strong||a||None||0||0|
|Nomura Holdings Inc.*||A-/Stable||bbb+||Moderate||Strong||Moderate||Avg/Adequate||bbb||Sys. Imp.||2||0|
|Norinchukin Bank||A/Negative||bbb+||Adequate||Adequate||Moderate||Above Avg/Strong||bbb+||Sys. Imp.||2||0|
|Resona Holdings*||A/Stable||bbb+||Adequate||Moderate||Adequate||Above Avg/Strong||bbb+||Sys. Imp.||2||0|
|Shinkin Central Bank||A/Stable||bbb+||Adequate||Adequate||Adequate||Avg/Strong||bbb+||Sys. Imp.||2||0|
|Shizuoka Bank Ltd.||A-/Stable||bbb+||Adequate||Strong||Adequate||Avg/Strong||a-||None||0||0|
|Sumitomo Mitsui Financial Group Inc.*||A/Stable||bbb+||Strong||Adequate||Adequate||Above Avg/Strong||a||None||0||0|
|Sumitomo Mitsui Trust Holdings*||A/Stable||bbb+||Strong||Adequate||Adequate||Avg/Strong||a-||Sys. Imp.||1||0|
|Industrial Bank of Korea||AA-/Stable||bbb+||Adequate||Adequate||Adequate||Avg/Adequate||bbb+||GRE||4||0|
|KEB Hana Bank||A+/Stable||bbb+||Strong||Adequate||Adequate||Avg/Adequate||a-||Sys. Imp.||2||0|
|Kookmin Bank||A+/Stable||bbb+||Strong||Adequate||Adequate||Avg/Adequate||a-||Sys. Imp.||2||0|
|Korea Development Bank§||AA/Stable||bbb+||Moderate||Moderate||Weak||Below Avg/Adequate||bb-||GRE||10||0|
|Nonghyup Bank||A+/Stable||bbb+||Strong||Adequate||Moderate||Above Avg/Adequate||bbb+||GRE||3||0|
|Shinhan Bank||A+/Stable||bbb+||Strong||Adequate||Adequate||Avg/Adequate||a-||Sys. Imp.||2||0|
|Woori Bank||A/Positive||bbb+||Strong||Adequate||Moderate||Avg/Adequate||bbb+||Sys. Imp.||2||0|
|Public Bank Bhd.||A-/Negative||bbb||Strong||Adequate||Strong||Above Avg/Strong||a||None||0||-1|
|Malayan Banking Bhd.||A-/Negative||bbb||Strong||Adequate||Adequate||Above Avg/Strong||a-||None||0||0|
|CIMB Bank Bhd.||A-/Negative||bbb||Strong||Adequate||Adequate||Above Avg/Strong||a-||None||0||0|
|ANZ Bank New Zealand Ltd.||AA-/Negative||bbb||Strong||Strong||Adequate||Avg/Adequate||a-||Group||3||0|
|ASB Bank Ltd.||AA-/Negative||bbb||Strong||Strong||Adequate||Avg/Adequate||a-||Group||3||0|
|Bank of New Zealand||AA-/Negative||bbb||Strong||Adequate||Adequate||Avg/Adequate||bbb+||Group||4||0|
|Westpac New Zealand Ltd.||AA-/Negative||bbb||Strong||Strong||Adequate||Avg/Adequate||a-||Group||3||0|
|DBS Bank Ltd.||AA-/Stable||bbb+||Strong||Adequate||Adequate||Above Avg/Strong||a||Sys. Imp.||2||0|
|Oversea-Chinese Banking Corp. Ltd.||AA-/Stable||bbb+||Strong||Adequate||Adequate||Above Avg/Strong||a||Sys. Imp.||2||0|
|United Overseas Bank Ltd.||AA-/Stable||bbb+||Strong||Adequate||Adequate||Above Avg/Strong||a||Sys. Imp.||2||0|
|CTBC Bank Co. Ltd.||A/Stable||bbb||Strong||Strong||Adequate||Avg/Strong||a-||Sys. Imp.||1||0|
|Mega International Commercial Bank Co. Ltd.||A/Stable||bbb||Strong||Strong||Adequate||Avg/Adequate||a-||Sys. Imp.||1||0|
|Bangkok Bank Public Co. Ltd.||BBB+/Stable||bb+||Strong||Adequate||Adequate||Above Avg/Strong||bbb||Sys. Imp.||1||0|
|KASIKORNBANK PCL||BBB+/WatchNeg||bb+||Strong||Adequate||Adequate||Avg/Strong||bbb-||Sys. Imp.||2||0|
|Krung Thai Bank Public Co. Ltd.||BBB/WatchNeg||bb+||Adequate||Adequate||Adequate||Avg/Adequate||bb+||Sys. Imp.||2||0|
|Siam Commercial Bank Public Co. Ltd.||BBB+/Negative||bb+||Strong||Adequate||Adequate||Avg/Strong||bbb-||Sys. Imp.||2||0|
|Data as of September 30, 2020. Type of Support column -'None' includes some banks where ratings uplift because of support factors may be possible but none is currently included. (For example, this column includes some systemically important banks where systemic importance results in no rating uplift). *Holding company; the rating reflects that on the main operating company. ICR--Issuer credit rating. GRE--Government-related entity. SACP--Stand-alone credit profile. Sys. Imp.--Systemically important. ALAC--Additional loss-absorbing capacity. N/A--Not applicable. Sov --Capped by Sovereign Rating. §This ICR applies to the Foreign Currency Rating only.|
|Recent Rating Actions: Asia Pacific Banks|
|Release date||Org legal name||Org country||From||To|
|07-Sep-20||AMP Ltd.||Australia||BBB/Watch Neg/--||BBB-/Stable/--|
|07-Sep-20||AMP Bank Ltd.||Australia||BBB+/Watch Neg/A-2||BBB/Stable/A-2|
|24-Aug-20||Siam Commercial Bank Public Co. Ltd.||Thailand||BBB+/Stable/A-2||BBB+/Negative/A-2|
|24-Aug-20||Krung Thai Bank Public Co. Ltd.||Thailand||BBB/Stable/A-2||BBB/Watch Neg/A-2|
|24-Aug-20||KASIKORNBANK PCL.||Thailand||BBB+/Stable/A-2||BBB+/Watch Neg/A-2|
|24-Aug-20||TMB Bank Public Co. Ltd.||Thailand||BBB-/Positive/A-3||BBB/Negative/A-2|
|04-Aug-20||Seven Bank, Ltd.||Japan||A+/Stable/A-1||A+/Watch Neg/A-1|
|02-Aug-20||China Guangfa Bank Co. Ltd.||China||BBB-/Stable/A-3||BBB-/Negative/A-3|
|16-Jul-20||Sony Bank Inc.||Japan||A/Watch Neg/A-1||A/Stable/A-1|
|13-Jul-20||AMP Ltd.||Australia||BBB+/Watch Neg/--||BBB/Watch Neg/--|
|08-Jul-20||Guangzhou Finance Holdings Group Co. Ltd.||China||BBB+/Stable/A-2||BBB+/Negative/A-2|
|*Recent rating actions are for the period July 1, 2020 to September 30, 2020. The list refers to banks and bank holding companies (banks) where the rating has been upgraded or downgraded, or the outlook has been changed. Banks where the ratings have been affirmed or the outlooks have not been changed are not included in the list.|
This report does not constitute a rating action.
S&P Global Ratings Australia Pty Ltd holds Australian financial services license number 337565 under the Corporations Act 2001. S&P Global Ratings' credit ratings and related research are not intended for and must not be distributed to any person in Australia other than a wholesale client (as defined in Chapter 7 of the Corporations Act).
|Primary Credit Analyst:||Gavin J Gunning, Melbourne (61) 3-9631-2092;|
|Secondary Contacts:||Vera Chaplin, Melbourne (61) 3-9631-2058;|
|Ryoji Yoshizawa, Tokyo (81) 3-4550-8453;|
|Sharad Jain, Melbourne (61) 3-9631-2077;|
|Geeta Chugh, Mumbai (91) 22-3342-1910;|
|Harry Hu, CFA, Hong Kong (852) 2533-3571;|
|Ivan Tan, Singapore (65) 6239-6335;|
|Nico N DeLange, Sydney (61) 2-9255-9887;|
|Daehyun Kim, CFA, Hong Kong (852) 2533-3508 ;|
|HongTaik Chung, CFA, Hong Kong (852) 2533 3597;|
|Eunice Fan, Taipei (8862) 8722-5818;|
|Chizuru Tateno, Tokyo (81) 3-4550-8578;|
|Fern Wang, CFA, Hong Kong (852) 2533-3536;|
|Ryan Tsang, CFA, Hong Kong (852) 2533-3532;|
|Ming Tan, CFA, Hong Kong + 852 2532 8074;|
|Lisa Barrett, Melbourne (61) 3-9631-2081;|
|Research Assistant:||Priyal Shah, CFA, Mumbai|
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