Moody’s affirms Ambank’s (P)Ba2 euro MTN with stable outlook

Moody’s affirms Ambank’s (P)Ba2 euro MTN with stable outlook

KUALA LUMPUR,. Moody’s Investors Service has affirmed a provisional (P)Ba2 foreign currency rating for AmBank (M) Bhd’s US$2 billion (RM9.4 billion) Euro Medium Term Note (MTN) Programme with a stable outlook.

“Ambank’s rating is positioned two notches below the baa3 adjusted baseline credit assessment (BCA), in line with Moody’s standard notching guidance for subordinated debt, with loss triggered at the point of non-viability on a contractual basis,” it said in a statement today.

Moody’s said on Nov 8, 2018, AmBank updated its existing Euro MTN programme to allow the issuance of foreign currency-denominated subordinated notes.

The rating is positioned one notch below that of “plain vanilla” subordinated debt with normal loss severity, said Moody’s.

“Under the programme’s terms, the principal on these notes would be written down, partially or in full, in the event that the Malaysian regulatory authorities—Bank Negara Malaysia and the Malaysian Deposit Insurance Corporation—notify AmBank that without such write-off, the bank and/or AMMB Group would become non-viable, or if they decide to make a public sector injection of capital without which the bank and/or AMMB Group would become non-viable,” it said.

Moody’s assessed the notional BCA of AMMB Group to be underpinned by and at the same level as the baa3 BCA of AmBank, the group’s largest operating subsidiary by assets. — Bernama