Bangkok--14 May--Standard & Poor's Standard & Poor's Ratings Services today assigned its 'AA' rating to Tokyo Metropolitan Government's (TMG; AA/Stable/--) ?20 billion domestic bonds due March 17, 2028. The coupon rate is 2.31%. The major factors in evaluating the credit quality of TMG are: -- Its robust local tax base as the center of the Japanese and Asian economy, providing it with a strong independent source of revenue; -- Its track record of fiscal reforms, streamlining expenditures to improve its financial profile under the strong leadership of Governor Ishihara; and -- Its sophisticated financial management practices. Constraints on the rating include its decreasing financial flexibility, mainly due to increasing social care costs and its high level of debt, albeit decreasing. TMG's economy compares well with the national GDP of G7 member countries and attracts a large number of national and international enterprises, which contribute to its corporate tax revenues. Out of the 47 prefectures in Japan, only TMG has remained autonomous of the central government's vertical fiscal adjustment system during the postwar period. It is unique among Japan's local and regional governments, in that it has both features of a prefecture and a city, which contribute to its strong revenue sources. The rating on TMG would be influenced by changes to the sovereign rating on Japan (AA/Stable/A-1+). Although TMG is not reliant on the vertical fiscal adjustment system, it would not be immune to the fiscal impacts derived from any changes in the national system. However, the ratings are not directly linked. A Japanese-language version of this media release is available on Standard & Poor's Research Online at www.researchonline.jp, or via CreditWire Japan on Bloomberg Professional at SPCJ . Complete ratings information is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Find a Rating, then Credit Ratings Search. Media Contact: David Wargin, New York (1) 212-438-1579, [email protected] Analyst Contact: Kumiko Kakimoto, Tokyo (81) 3-4550-8705 Standard & Poor's, a division of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. With approximately 8,500 employees, including wholly owned affiliates, located in 23 countries and markets, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com. Key Contacts: Americas Media Relations: (1) 212-438-6667 media_ [email protected] Americas Customer Service: (1) 212-438-7280 [email protected]