LISTED commercial bank China Banking Corp. said on Tuesday it has secured a ‘Baa2’ investment grade credit rating from Moody’s Investors Service due to its strong capitalization underpinned by strong support from key shareholders.
The rating is the same level as the Philippine sovereign rating and is at par with the country’s top three biggest banks.
“Notably, the Bank has maintained very close multi-generational relationships with businesses as a corporate financier, building on a continuing story of growth. Moody’s expects broad stability in China Bank’s asset quality given the robust operating environment and the relatively low level of leverage in the economy,” Moody’s said.
“We are immensely gratified to have earned an investment grade credit rating from Moody’s. It strongly validates China Bank’s institutional and balance sheet strength across key indicators,” China Bank President and Chief Executive Officer Ricardo Chua said in a disclosure to the Philippine Stock Exchange (PSE) on Tuesday.
“Asset quality continues to improve while we keep credit costs at low level. Our capital ratios are among the strongest in the industry following the P15-billion stock rights offering last month,” he added.
According to Moody’s, firms with obligations rated ‘Baa2’ are subject to moderate credit risk. Such firms are considered medium grade and may possess certain speculative characteristics.
“[The rating] will boost our ability to do more deals especially those where counterparties are required to be rated by Moody’s or other credit rating agencies,” China Bank Chief Operating Officer William Whang said.
Earlier this year, China Bank secured a long-term issuer default rating at ‘BB+’ and a viability rating at ‘bb+’ from international credit rating agency Fitch Ratings, with a stable outlook.
Incorporated in 1920, China Bank is a private universal bank in the Philippines providing corporate, commercial, and retail services to customers through 552 branches to date. It also offers bancassurance and insurance brokerage services through its subsidiaries China Bank Manulife Life Assurance Corp. and China Bank Capital Corp.