OREANDA-NEWS.  Fitch Ratings has assigned Singapore-based Oversea-Chinese Banking Corp's (OCBC) SGD500m 3.80% non-cumulative non-convertible perpetual capital securities a final rating of 'BBB'.

The final rating follows the completion of the securities issue, as well as the receipt of final documentation conforming to information previously received. The final rating is the same as the expected rating assigned on 17 August 2015.

KEY RATING DRIVERS

The securities are rated five notches below OCBC's 'aa-' Viability Rating (VR), comprising two notches for loss severity and three notches for non-performance risk, in accordance with Fitch's Global Bank Rating Criteria.

The loss severity is high in view of the securities' deep subordination status. The securities, together with all other Additional Tier 1 capital securities issued or guaranteed by OCBC, will rank ahead of claims only from OCBC's ordinary shareholders, and below all senior liabilities and Tier 2 capital securities of the bank in liquidation.

The securities are also subject to write-off at a point of non-viability as determined by the Monetary Authority of Singapore (MAS). The amount to be written off will be as much as is required for the bank to cease to be non-viable, as determined by OCBC in consultation with MAS, or as directed by MAS, up to the full principal and distribution amount on the securities. The full principal and distribution amount must be written off ahead of any write-off of OCBC's Basel III Tier 2 securities.

Non-performance risk arises from OCBC's unrestricted discretion in cancelling any periodic distribution on the proposed securities. OCBC will also not be obliged to pay any distribution if it is prevented from doing so under Singapore banking regulations or other requirements of the MAS. Distribution on the securities would otherwise be made semi-annually at a fixed rate, subject to reset on the applicable reset dates.

RATING SENSITIVITIES

A change in OCBC's VR will have an impact on the securities' ratings.

For more details on OCBC's ratings and credit profile, see the rating action commentary "Fitch Affirms Major Singapore Banks at 'AA-'; Outlook Stable", dated 14 August 2015, and its full rating report, dated 14 October 2014, which are available at www.fitchratings.com.

OCBC's other ratings are as follows:
Long-Term Issuer Default Rating 'AA-'; Outlook Stable
Short-Term Issuer Default Rating 'F1+'
Viability Rating 'aa-'
Support Rating '1'
Support Rating Floor 'A-'