Bangkok--12 Feb--Fitch Ratings
Fitch Ratings (Thailand) Limited has today affirmed the National Long-term ratings of Mitsubishi Motors (Thailand) Company Limited's ("MMTh") THB5.0 billion guaranteed debentures due 2008 and THB2.0bn guaranteed debentures due 2009 at 'AAA(tha)'. The rating Outlook is Stable.
The ratings are based entirely on the full, irrevocable and unconditional guarantee on the debentures by Bank of Tokyo-Mitsubishi UFJ of Japan ("BTMU", rated Long-term foreign currency Issuer Default ("IDR") 'A'/ Positive). As BTMU's rating is at the same level as the Thai sovereign's (rated Long-term local currency IDR 'A'/ Stable), the guaranteed debentures are rated at the same level as Thailand's sovereign National rating of 'AAA(tha)'. Fitch says that any changes in the International rating differential between BTMU and the Thai sovereign will affect the debentures' National rating. Investors should note that a one notch change in the differential between the International ratings of BTMU and the Thai sovereign could result in a change of greater than one notch in the debentures' National rating.
The rating of the guarantor, BTMU, reflects the bank's existing franchise, improved asset quality and good capital levels. The rating also takes into account the bank's low underlying profitability compared with its overseas counterparts and its challenging operating environment against a background of weak loan demand and increasing competition. Given BTMU's importance to the domestic and international financial system, Fitch believes there is an extremely high probability that support from the state would be forthcoming, should it be required.
BTMU is the merged entity resulting from the union of Bank of Tokyo-Mitsubishi and UFJ Bank, which came after creation of Mitsubishi UFJ Financial group, the largest banking group in Japan from the merger of former parent, Mitsubishi Tokyo Financial Group, and UFJ Holdings.
MMTh is Mitsubishi Motors Corporation's ("MMC") sole pick-up truck manufacturing base for global distribution and the sole manufacturer and distributor of Mitsubishi automotive products in Thailand, including pick-up trucks and passenger cars. MMTh is one of the leaders in Thailand's car export market, and is the third-largest pickup distributor locally. MMTh's car exports accounted for around 22% of Thailand's car exports in 9M06, and its pickup sales made up 7% domestically. MMTh is a 99.8% owned subsidiary of MMC.
Contacts: Lertchai Kochareonrattanakul, Soamsiri Chadavadh, 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.
Media Relations: Ching-Yuen Lock, Singapore, Tel: +65 6238 7301; Sylvia McKaige, Singapore, Tel: + 65 6336 6801.