HONG KONG, 17 October2024 – Lianhe Ratings Global Limited (“Lianhe Global”), an international credit rating company, has assigned ‘A’ global scale Long-term Issuer Credit Rating to The Bank of East Asia, Limited (“BEA” or “the bank”). The Outlook is Stable.
Key Rating Rationales
The Issuer Rating reflects BEA’s established market position, strong capitalization and adequate funding and liquidity profile. The rating also considers its moderate profitability and still significant commercial real-estate related exposure which may pressure its asset quality. In addition, we expect a moderate possibility of extraordinary support to be provided by the Hong Kong government, if needed, considering BEA’s significant asset market share in Hong Kong’s banking system.
The Stable Outlook reflects our expectation that BEA will maintain its prudent risk control and capital position to withstand unfavorable market movements.
Rating Sensitivities
We would consider downgrading BEA’s rating if there is 1) significant deterioration in capital adequacy and liquidity, or 2) notable deterioration in asset quality and profitability, or 3) weakened funding structure, or 4) perceived lower possibility of government support.
We would consider upgrading BEA’s rating if it were to 1) improve its profitability and asset quality, and 2) improve the diversification of business profile and loan portfolio.
About Lianhe Global
Lianhe Global is an international credit rating company that provides credit ratings to corporations, banks, non-bank financial institutions, local investment and development companies, and other asset classes around the globe. Lianhe Global also provides credit risk research and other services related to credit ratings.
Rating Methodology
The principal methodology used in this BEA’s rating is Lianhe Global’s is Banking Rating Criteria published on 20 March 2023, which can be found at the website www.lhratingsglobal.com.
Note: The above Issuer/Issuance Credit Ratings are unsolicited ratings. None of the aforementioned entities nor its related parties participate in the credit rating process. Our analysis is conducted based on publicly available information.
Contact Information
Primary Analyst, Hong Kong
Joyce Huang, CFA
Managing Director
(852) 3462 9586
joyce.huang@lhratingsglobal.com
Secondary Analyst, Beijing
Min Zhang
Analyst
(86) 10 8567 9696
min.zhang@lhratingsglobal.com
Committee Chairperson and Ratings Approver, Hong Kong
Toni Ho, CFA, FRM
Senior Director
(852) 3462 9578
toni.ho@lhratingsglobal.com
Media Contact, Hong Kong
Alice Wang
(852) 3462 9568
alice.wang@lhratingsglobal.com
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