Moody's rates Bocom International A3

Moody's Investors Service said it assigned an A3 long-term issuer rating and prime-2 short-term issuer rating to Bocom International Holdings Co. Ltd.

The outlook is stable.

Bocom International's A3 long-term issuer rating reflects its standalone assessment of Ba1 and a one-notch uplift based on an assumption of a very high level of support from its parent, Bank of Communications Co., Ltd. (Bocom). The ratings also consider a three-notch uplift based on an assumption of a very high level of indirect support from the Chinese government, if needed, Moody's explained.

The Ba1 standalone assessment reflects Bocom International's long history of and niche franchise in providing offshore financial services to Chinese corporations and individuals, while leveraging the parent bank's client network, strong track record of profitability and low leverage, the agency said.

Offsetting these credit strengths are the risks arising from the company's rapid asset growth especially in the level 3 assets, as well as continued expansion in the investment and loans business, which could bring higher earnings volatility, Moody's said.

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