Fitch Rates China Everbright Bank HK Branch's Notes 'BBB'

China Everbright Environment

11/06/2018 04:00

(The following statement was released by the rating agency)


Fitch Ratings-Hong Kong/Taipei-June 10: Fitch Ratings has assigned final ratings 
of 'BBB' to the senior unsecured USD300 million and EUR300 million floating-rate 
notes due 2021 issued by China Everbright Bank, Hong Kong Branch (CEB Hong Kong 
Branch) under its USD5 billion medium-term note (MTN) programme. 

Proceeds from the US dollar- and euro-denominated notes will be used primarily 
to support the Hong Kong Branch's general funding needs. The final ratings are 
in line with the expected rating assigned on 23 May 2018, and follow the receipt 
of documents conforming to information previously received. 

Fitch first rated CEB Hong Kong Branch's MTN programme 'BBB' on 14 September 
2016 and last affirmed the rating on 19 July 2017. The programme's size was 
increased to USD5 billion from USD2 billion in May 2018 to meet the bank's 
funding needs. The programme rating is not affected by the increase in size, as 
the addition is small in relation to CEB's total assets.  

KEY RATING DRIVERS 

CEB Hong Kong Branch is part of the legal entity China Everbright Bank Company 
Limited (CEB, BBB/Stable). Therefore, the notes issued under the MTN programme 
ultimately represent CEB's direct, unconditional, unsecured and unsubordinated 
obligations and are rated in line with CEB's Long-Term Issuer Default Rating 
(IDR) of 'BBB' with Stable Outlook. CEB's IDR is underpinned by the agency's 
expectation of a high probability of support from the Chinese sovereign 
(A+/Stable) in the event of stress.

CEB Hong Kong Branch was established in 2013, and is a fully licensed bank in 
Hong Kong. It is the first and largest overseas branch of CEB, and its 
operations and business are highly integrated with CEB. CEB also provides credit 
facilities to the Hong Kong Branch to support its liquidity needs.

RATING SENSITIVITIES

Any change to the ratings of the programme and the notes will be correlated 
directly with changes to CEB's IDR, which will in turn reflect any shift in the 
perceived willingness or ability of the Chinese government to support CEB in a 
full and timely manner.

Contact: 

Primary Analyst 

Grace Wu

Senior Director

+852 2263 9919

Fitch (Hong Kong) Limited

19/F Man Yee Building

68 Des Voeux Road Central, Hong Kong

Secondary Analyst

Katie Chen

Director

+886 2 8175 7614

Committee Chairperson 

Tim Roche

Senior Director

+61 2 8256 0310

Date of the Relevant Rating Committee: 18 July 2017

Media Relations: Leslie Tan, Singapore, Tel: +65 67 96 7234, Email: 
leslie.tan@fitchratings.com; Wai-Lun Wan, Hong Kong, Tel: +852 2263 9935, Email: 
wailun.wan@fitchratings.com.

Additional information is available on www.fitchratings.com

Applicable Criteria 

Global Bank Rating Criteria - Effective from 25 November 2016 to 23 March 2018 
(pub. 25 Nov 2016)

https://www.fitchratings.com/site/re/891051

Additional Disclosures 

Dodd-Frank Rating Information Disclosure Form 

https://www.fitchratings.com/site/dodd-frank-disclosure/10033879

Solicitation Status 

https://www.fitchratings.com/site/pr/10033879#solicitation

Endorsement Policy 

https://www.fitchratings.com/regulatory

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