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ARCHIVE | Criteria | Financial Institutions | Banks: Rating Japan's Bank Holding Companies Jun 00
Standard & Poors, June 2000
Abstract
Interest in bank holding companies (BHCs) has accelerated since Japanese regulators revised the Banking Law in December 1998 to allow this type of structure. Since then, four mega-consolidation deals have been announced by several major Japanese banks, which will result in the formation of three BHCs. Two regional banks have also announced their intention to consolidate under a BHC. This article summarizes Standard & Poor's general rating approach for BHCs, and examines some Japan-specific issues. In general, a counterparty credit rating (sometimes referred to as the issuer credit rating) assigned to a BHC is lower than that of its subsidiary banks (see Section 2, 'Exceptional Cases', below for details on BHCs which are rated equal with their subsidiaries). This rating...
Companies mentioned in this report are: Japan (Unsolicited Ratings)
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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