(The following statement was released by the rating agency)
SINGAPORE/HONG KONG, April 09 (Fitch) Fitch Ratings has assigned
Oversea-Chinese Banking Corp's (OCBC) proposed US
III-compliant Tier 2 capital securities an expected rating of
Rating Watch Negative (RWN).
The final rating is subject to the receipt of final
documentation conforming to
information already received.
KEY RATING DRIVERS
The Basel III-compliant Tier 2 securities are rated one notch
Viability Rating (VR) of 'aa-'/RWN to reflect their
risk due to their partial rather than mandatory full write-off
notes contain a non-viability clause and rank subordinated to
The Monetary Authority of Singapore (MAS) has sole discretion in
OCBC is non-viable, and if it does so, the securities may be
full or in part to the extent determined by OCBC, which Fitch
expects to be in
conjunction with what MAS considers necessary to restore the
viability of the
bank. The write-off can be effected in full even if it is not
sufficient for the
trigger event to cease to continue. There are no write-back
features on the
No additional notching has been ascribed to non-performance risk
regards it minimal relative to the VR assigned. The instruments
will not qualify
for equity credit under Fitch's criteria.
Upon the occurrence of any winding-up proceedings, holders of
these securities -
and all Tier 2 securities of OCBC - will rank below the bank's
including depositors, but above the bank's ordinary shareholders
and holders of
additional Tier 1 capital securities in priority of claims.
A change in OCBC's VR, presently on RWN, will have an impact on
rating. The RWN reflects OCBC's planned acquisition of Hong
Kong's Wing Hang
Bank Limited (A-/Rating Watch Positive) and also applies to
OCBC's Long-Term and
Short-Term Issuer Default Ratings (see "Fitch Places OCBC on
Watch Negative on
Wing Hang Bank Takeover Plan", dated 2 April 2014).
Established in 1932, OCBC is a Singapore-based listed bank with
assets of SGD338bn at end-2013.
For more details on OCBC's ratings and credit profile, see
OCBC's full rating
report, dated 2 May 2013, available at www.fitchratings.com.
OCBC's other ratings are as follows:
Long-Term IDR 'AA-'; on RWN
Short-Term IDR 'F1+'; on RWN
Viability Rating 'aa-'; on RWN
Support Rating '1'
Support Rating Floor 'A-'
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Additional information is available at www.fitchratings.com.
Applicable criteria, "Global Financial Institutions Rating
Criteria", dated 31
January 2014, and "Assessing and Rating Bank Subordinated and
Securities", dated 31 January 2014, are available at
Applicable Criteria and Related Research:
Global Financial Institutions Rating Criteria
Assessing and Rating Bank Subordinated and Hybrid Securities
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