Moody's Investors Service Inc. assigned an Aa2 rating Wednesday to two types of yen-denominated domestic bonds newly issued by the Japan Bank for International Cooperation. At the same time, however, it placed the ratings under review for possible downgrade.
The ratings were assigned to JBIC's series 1 domestic yen bonds totaling 50 billion yen, due on Sept. 20, 2006, and series 2 bonds of the same size to mature on Sept. 20, 2011. The debt marks the bank's first issuance of domestic yen bonds without government guarantee.
Moody's Aa2 domestic currency issuer rating for the bank has been under review since Sept. 6 in accordance with the U.S. rating agency's decision to place under review the Aa2 rating of yen-denominated domestic securities issued or guaranteed by the Japanese government for possible downgrade. JBIC is wholly owned by the Japanese government and is in charge of implementing Japan's official development assistance programs.
"The ratings of JBIC are constrained by the rating of the government of Japan," Moody's said in its release.
Moody's said there is "a remote risk of possible privatization, substitution and dissolution of JBIC, in view of the continued importance of foreign economic policy management to Japan in relation to developing countries."