Bangkok--Nov 14--Fitch Ratings
Fitch Ratings (Thailand) Limited has today assigned an Expected Long-term National rating of ‘AA+(tha)’ to the up to THB5.0 billion three-year guaranteed debentures to be issued by Mitsubishi Motors (Thailand) Company Limited (“MMTh”). The Outlook is Stable. The rating is based entirely on a full, irrevocable and unconditional guarantee by Bank of Tokyo Mitsubishi of Japan (“BTM”, rated International Long-term foreign currency ‘A-’ (A minus) with Stable Outlook).
In line with Fitch’s rating methodology, the International ‘A-’ (A minus) rating for BTM is currently one notch below the Thai sovereign’s (rated International local currency ‘A’ with Stable Outlook). Hence, the guaranteed debentures are rated one notch below Thailand’s National rating of ‘AAA(tha)’. Fitch says that any changes in the International rating differential between BTM and the Thai sovereign will affect the debentures’ National rating. Investors should note that a one notch change in the International rating could result in change of greater than one notch in the National rating. The Expected rating is contingent upon receipt of final documents conforming to information already received.
The rating of the guarantor, BTM, reflects Fitch’s opinion that there is an extremely high probability of support for the bank, from the State, should the need arise. BTM’s Individual rating of ‘C/D’, meanwhile, reflects the bank’s good asset quality, adequate capitalisation and improving operating profitability. BTM’s parent, Mitsubishi Tokyo Financial Group, and UFJ Holdings, the parent of UFJ Bank and UFJ Trust & Banking, recently merged to form Mitsubishi UFJ Financial Group, the world’s largest banking group in terms of assets. At the same time, the two trust banking subsidiaries, Mitsubishi Trust and UFJ Trust formed Mitsubishi UFJ Trust & Banking. In early 2006, the two groups’ commercial banking subsidiaries will also merge to create Bank of Tokyo-Mitsubishi UFJ. Given Fitch’s view of support, the downward potential of the newly merged commercial bank’s Long-term rating, is very limited. As stated in a press release dated 13 July 2005, the new bank’s Individual rating will likely be ‘C/D’. Fitch also previously noted that any upgrade will be dependent on the success and speed of integration, which would affect the bank’s operating profitability and capital quality.
MMTh is the sole Mitsubishi Motors Corporation’s (“MMC”) pick-up truck manufacturing base for global distribution and the sole manufacturer and distributor of MMC’s automotive products in Thailand, including pick-up trucks and passenger cars. MMTh enjoys a leading position in Thailand’s car export market, and it is the fourth-largest pickup distributor locally. MMTh’s pickup exports accounted for 27% of Thailand’s car exports in 2004, and its pickup sales made up 8% domestically. MMTh is a 99.8%-owned subsidiary of MMC.
Contact: Lertchai Kochareonrattanakul, Wasant Polcharoen, Vincent Milton, Bangkok, Tel : +662 655 4755 ; Reiko Toritani, Tokyo, Tel: +81 3 3288 2673
Note to Editors: Fitch’s National ratings provide a relative measure of creditworthiness for rated entities in countries with sub- or low-investment grade international sovereign ratings. The best risk within a country is rated ‘AAA’ and other credits are rated only relative to this risk. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as ‘AAA(tha)’ for National ratings in Thailand. Specific letter grades are not therefore internationally comparable.
Fitch’s rating definitions and the terms of use of such ratings are available on the agency’s public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch’s code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the ‘Code of Conduct’ section of this site. End.