U.S. Markets closed
  • S&P 500

    4,395.64
    +41.45 (+0.95%)
     
  • Dow 30

    34,258.32
    +338.48 (+1.00%)
     
  • Nasdaq

    14,896.85
    +150.45 (+1.02%)
     
  • Russell 2000

    2,218.56
    +32.38 (+1.48%)
     
  • Gold

    1,768.40
    -9.80 (-0.55%)
     
  • Silver

    23.03
    +0.46 (+2.05%)
     
  • EUR/USD

    1.1696
    -0.0034 (-0.2924%)
     
  • 10-Yr Bond

    1.3360
    +0.0120 (+0.91%)
     
  • Vix

    20.87
    -3.49 (-14.33%)
     
  • GBP/USD

    1.3619
    -0.0045 (-0.3282%)
     
  • USD/JPY

    109.7800
    +0.5600 (+0.5127%)
     
  • BTC-USD

    42,539.95
    +402.49 (+0.96%)
     
  • CMC Crypto 200

    1,089.55
    +49.07 (+4.72%)
     
  • FTSE 100

    7,083.37
    +102.39 (+1.47%)
     
  • Nikkei 225

    29,639.40
    -200.31 (-0.67%)
     

Cincinnati Casualty Company (The) -- Moody’s affirms Cincinnati Financial’s ratings (senior debt A3); outlook changed to stable from positive

·31 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

<!DOCTYPE html> <html lang="" xml:lang=""> <head> <title>/nwsys/www/images/PR_1000003099</title> <meta http-equiv="Content-Type" content="text/html; charset=UTF-8"/> <meta name="generator" content="pdftohtml 0.36"/> <meta name="date" content="2020-07-06T18:19:07+00:00"/> <style type="text/css"> <!-- .xflip { -moz-transform: scaleX(-1); -webkit-transform: scaleX(-1); -o-transform: scaleX(-1); transform: scaleX(-1); filter: fliph; } .yflip { -moz-transform: scaleY(-1); -webkit-transform: scaleY(-1); -o-transform: scaleY(-1); transform: scaleY(-1); filter: flipv; } .xyflip { -moz-transform: scaleX(-1) scaleY(-1); -webkit-transform: scaleX(-1) scaleY(-1); -o-transform: scaleX(-1) scaleY(-1); transform: scaleX(-1) scaleY(-1); filter: fliph + flipv; } --> </style> </head> <body bgcolor="#A0A0A0" vlink="blue" link="blue"> <!-- Page 1 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft00{font-size:18px;font-family:Times;color:#000000;} .ft01{font-size:18px;font-family:Times;color:#1257c7;} .ft02{font-size:14px;font-family:Times;color:#666666;} .ft03{font-size:13px;font-family:Times;color:#0d0c0c;} .ft04{font-size:13px;line-height:31px;font-family:Times;color:#0d0c0c;} .ft05{font-size:13px;line-height:30px;font-family:Times;color:#0d0c0c;} --> </style> <div id="page1-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003099001.png" alt="background image"/> <p style="position:absolute;top:162px;left:108px;white-space:nowrap" class="ft00"><b>Rating Action:&#160;</b></p> <p style="position:absolute;top:162px;left:252px;white-space:nowrap" class="ft01"><b>Moody’s affirms Cincinnati Financial’s ratings (senior</b></p> <p style="position:absolute;top:186px;left:108px;white-space:nowrap" class="ft01"><b>debt A3); outlook changed to stable from positive</b></p> <p style="position:absolute;top:233px;left:108px;white-space:nowrap" class="ft02"><b>6 July 2020</b></p> <p style="position:absolute;top:266px;left:108px;white-space:nowrap" class="ft03">New York, July 6, 2020 – Moody’s Investors Service has affirmed the A3 senior debt rating of</p> <p style="position:absolute;top:286px;left:108px;white-space:nowrap" class="ft03">Cincinnati Financial Corporation (NASDAQ: CINF) and the A1 insurance financial strength (IFS)</p> <p style="position:absolute;top:305px;left:108px;white-space:nowrap" class="ft03">ratings of The Cincinnati Insurance Company and its rated property and casualty insurance affiliates</p> <p style="position:absolute;top:325px;left:108px;white-space:nowrap" class="ft03">(collectively, “Cincinnati Financial”). The rating outlook for all rated entities has been changed to</p> <p style="position:absolute;top:344px;left:108px;white-space:nowrap" class="ft04">stable from positive.<br/>RATINGS RATIONALE<br/>According to Moody’s, the ratings affirmation and stable outlook reflect Cincinnati Financial’s long-</p> <p style="position:absolute;top:426px;left:108px;white-space:nowrap" class="ft03">standing regional and increasingly national franchise, which benefits from strong relationships with</p> <p style="position:absolute;top:445px;left:108px;white-space:nowrap" class="ft03">independent agents, a focus on small and middle market commercial lines risks, and robust capital</p> <p style="position:absolute;top:465px;left:108px;white-space:nowrap" class="ft03">adequacy. The company maintains a conservative financial profile with sound reserves, low financial</p> <p style="position:absolute;top:484px;left:108px;white-space:nowrap" class="ft03">leverage and substantial holding company liquidity. These strengths are tempered by exposure to</p> <p style="position:absolute;top:504px;left:108px;white-space:nowrap" class="ft03">catastrophes, including the potential accumulations of weather-related losses given the company’s</p> <p style="position:absolute;top:523px;left:108px;white-space:nowrap" class="ft03">Midwest focus, competitive challenges in personal lines, potential investment volatility reflecting a</p> <p style="position:absolute;top:543px;left:108px;white-space:nowrap" class="ft03">sizeable common stock portfolio, and competition from well-capitalized nationwide commercial lines</p> <p style="position:absolute;top:562px;left:108px;white-space:nowrap" class="ft03">carriers. Cincinnati Financial's expansion outside of its traditional agency-focused primary business</p> <p style="position:absolute;top:582px;left:108px;white-space:nowrap" class="ft03">into assumed reinsurance -- including mortgage reinsurance – as well as its Lloyd’s operations, adds</p> <p style="position:absolute;top:601px;left:108px;white-space:nowrap" class="ft03">strategic and financial risk. However, the ratings agency noted that their risk contribution remains</p> <p style="position:absolute;top:621px;left:108px;white-space:nowrap" class="ft05">modest relative to the group's core earnings and strong capital base.<br/>For Cincinnati Financial and other P&amp;C insurers, the coronavirus and related-economic downturn will</p> <p style="position:absolute;top:671px;left:108px;white-space:nowrap" class="ft03">lead to lower premiums in certain lines and more volatile investment results. These challenges are</p> <p style="position:absolute;top:690px;left:108px;white-space:nowrap" class="ft03">offset by the group’s strong balance sheet and the sharp drop in claim frequencies in certain P&amp;C</p> <p style="position:absolute;top:710px;left:108px;white-space:nowrap" class="ft03">lines such as personal and commercial auto during the economic downturn. The change to a stable</p> <p style="position:absolute;top:729px;left:108px;white-space:nowrap" class="ft03">outlook from positive reflects economic uncertainty around the coronavirus and related economic</p> <p style="position:absolute;top:749px;left:108px;white-space:nowrap" class="ft03">downturn, along with the company's smaller scale compared to higher rated peers. The company</p> <p style="position:absolute;top:768px;left:108px;white-space:nowrap" class="ft03">could face potentially higher expenses and claims associated with rising litigation relating to the</p> <p style="position:absolute;top:788px;left:108px;white-space:nowrap" class="ft03">coronavirus including its commercial property policies. The rating agency expects the company will</p> <p style="position:absolute;top:807px;left:108px;white-space:nowrap" class="ft03">limit its discretionary spending through the downturn and maintain its strong liquidity and capital</p> <p style="position:absolute;top:827px;left:108px;white-space:nowrap" class="ft05">adequacy.<br/>The rating agency said that Cincinnati Financial’s A3 senior debt rating is two notches below the</p> <p style="position:absolute;top:876px;left:108px;white-space:nowrap" class="ft03">A1 IFS ratings of its insurance subsidiaries, rather than the standard three-notch spread, reflecting</p> <p style="position:absolute;top:896px;left:108px;white-space:nowrap" class="ft03">the substantial pool of liquid assets, largely common equities, at the holding company. As of March</p> <p style="position:absolute;top:915px;left:108px;white-space:nowrap" class="ft03">31, 2020, the holding company reported $2.6 billion of liquid assets, which exceeds total debt</p> <p style="position:absolute;top:935px;left:108px;white-space:nowrap" class="ft05">outstanding by a considerable margin.<br/>FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS<br/>Factors that could lead to an upgrade of Cincinnati Financial’s ratings include: (i) increased scale</p> <p style="position:absolute;top:1015px;left:108px;white-space:nowrap" class="ft03">and expansion of Cincinnati Financial's geographic footprint while maintaining strong capitalization</p> </div> <!-- Page 2 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft06{font-size:13px;font-family:Times;color:#1b62b7;} --> </style> <div id="page2-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003099002.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">and earnings, (ii) combined ratios (including catastrophes) at or below 95% across the cycle, (iii)</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft05">earnings coverage at or above 8x, and (iv) financial leverage at or below 15%.<br/>Factors that could lead to a downgrade of Cincinnati Financial’s ratings include: (i) combined ratios</p> <p style="position:absolute;top:183px;left:108px;white-space:nowrap" class="ft03">consistently above 100%, (ii) earnings volatility arising from new businesses including assumed</p> <p style="position:absolute;top:202px;left:108px;white-space:nowrap" class="ft03">reinsurance and operations at Lloyd's of London, (iii) earnings coverage less than 6x, (iv) financial</p> <p style="position:absolute;top:222px;left:108px;white-space:nowrap" class="ft03">leverage above 25%, and (v) decline in shareholders’ equity greater than 10% over a one-year</p> <p style="position:absolute;top:241px;left:108px;white-space:nowrap" class="ft05">period.<br/>LIST OF AFFECTED RATINGS<br/>Moody's has affirmed the following ratings:<br/>Cincinnati Financial Corporation - senior unsecured debt rating at A3;<br/>The Cincinnati Insurance Company - insurance financial strength rating at A1;<br/>The Cincinnati Casualty Company - insurance financial strength rating at A1;<br/>The Cincinnati Indemnity Company - insurance financial strength rating at A1.<br/>Moody's has revised the following rating outlooks:<br/>Cincinnati Financial Corporation -- outlook to stable from positive;<br/>The Cincinnati Insurance Company - outlook to stable from positive;<br/>The Cincinnati Casualty Company - outlook to stable from positive;<br/>The Cincinnati Indemnity Company - outlook to stable from positive.<br/>The principal methodology used in these ratings was Property and Casualty Insurers</p> <p style="position:absolute;top:624px;left:108px;white-space:nowrap" class="ft03">Methodology published in November 2019 and available at&#160;</p> <p style="position:absolute;top:624px;left:522px;white-space:nowrap" class="ft06">https://www.moodys.com/</p> <p style="position:absolute;top:644px;left:108px;white-space:nowrap" class="ft06">researchdocumentcontentpage.aspx?docid=PBC_1187352</p> <p style="position:absolute;top:644px;left:520px;white-space:nowrap" class="ft03">. Alternatively, please see the Rating</p> <p style="position:absolute;top:663px;left:108px;white-space:nowrap" class="ft05">Methodologies page on www.moodys.com for a copy of this methodology.<br/>Cincinnati Financial Corporation is an Ohio-based holding company whose property and casualty</p> <p style="position:absolute;top:713px;left:108px;white-space:nowrap" class="ft03">insurance subsidiaries write a broad range of commercial and personal insurance products. It</p> <p style="position:absolute;top:733px;left:108px;white-space:nowrap" class="ft03">operates in 45 states, with its most significant presence in the Midwest and South, and it distributes</p> <p style="position:absolute;top:752px;left:108px;white-space:nowrap" class="ft03">products through a growing network of independent agencies. In 2019, the company reported total</p> <p style="position:absolute;top:772px;left:108px;white-space:nowrap" class="ft03">revenues of $7.9 billion and net income of $2 billion. Shareholders' equity was approximately $8</p> <p style="position:absolute;top:791px;left:108px;white-space:nowrap" class="ft04">billion at March 31, 2020.<br/>REGULATORY DISCLOSURES<br/>For further specification of Moody’s key rating assumptions and sensitivity analysis, see</p> <p style="position:absolute;top:873px;left:108px;white-space:nowrap" class="ft03">the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure</p> <p style="position:absolute;top:892px;left:108px;white-space:nowrap" class="ft03">form. Moody’s Rating Symbols and Definitions can be found at:&#160;</p> <p style="position:absolute;top:892px;left:551px;white-space:nowrap" class="ft06">https://www.moodys.com/</p> <p style="position:absolute;top:912px;left:108px;white-space:nowrap" class="ft06">researchdocumentcontentpage.aspx?docid=PBC_79004</p> <p style="position:absolute;top:912px;left:503px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:942px;left:108px;white-space:nowrap" class="ft03">For ratings issued on a program, series, category/class of debt or security this announcement</p> <p style="position:absolute;top:962px;left:108px;white-space:nowrap" class="ft03">provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or</p> <p style="position:absolute;top:981px;left:108px;white-space:nowrap" class="ft03">note of the same series, category/class of debt, security or pursuant to a program for which the</p> <p style="position:absolute;top:1001px;left:108px;white-space:nowrap" class="ft03">ratings are derived exclusively from existing ratings in accordance with Moody's rating practices.</p> <p style="position:absolute;top:1020px;left:108px;white-space:nowrap" class="ft03">For ratings issued on a support provider, this announcement provides certain regulatory disclosures</p> <p style="position:absolute;top:1040px;left:108px;white-space:nowrap" class="ft03">in relation to the credit rating action on the support provider and in relation to each particular credit</p> </div> <!-- Page 3 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;}--> </style> <div id="page3-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003099003.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">rating action for securities that derive their credit ratings from the support provider's credit rating.</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft03">For provisional ratings, this announcement provides certain regulatory disclosures in relation to the</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft03">provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft03">to the final issuance of the debt, in each case where the transaction structure and terms have not</p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft03">changed prior to the assignment of the definitive rating in a manner that would have affected the</p> <p style="position:absolute;top:211px;left:108px;white-space:nowrap" class="ft03">rating. For further information please see the ratings tab on the issuer/entity page for the respective</p> <p style="position:absolute;top:231px;left:108px;white-space:nowrap" class="ft05">issuer on www.moodys.com.<br/>For any affected securities or rated entities receiving direct credit support from the primary entity(ies)</p> <p style="position:absolute;top:280px;left:108px;white-space:nowrap" class="ft03">of this credit rating action, and whose ratings may change as a result of this credit rating action, the</p> <p style="position:absolute;top:300px;left:108px;white-space:nowrap" class="ft03">associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach</p> <p style="position:absolute;top:319px;left:108px;white-space:nowrap" class="ft03">exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated</p> <p style="position:absolute;top:339px;left:108px;white-space:nowrap" class="ft05">entity, Disclosure from rated entity.<br/>The ratings have been disclosed to the rated entity or its designated agent(s) and issued with no</p> <p style="position:absolute;top:389px;left:108px;white-space:nowrap" class="ft05">amendment resulting from that disclosure.<br/>These ratings are solicited. Please refer to Moody’s Policy for Designating and Assigning Unsolicited</p> <p style="position:absolute;top:438px;left:108px;white-space:nowrap" class="ft05">Credit Ratings available on its website www.moodys.com.<br/>Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the</p> <p style="position:absolute;top:488px;left:108px;white-space:nowrap" class="ft05">related rating outlook or rating review.<br/>Moody’s general principles for assessing environmental, social and governance (ESG) risks in our</p> <p style="position:absolute;top:538px;left:108px;white-space:nowrap" class="ft03">credit analysis can be found at&#160;</p> <p style="position:absolute;top:538px;left:325px;white-space:nowrap" class="ft06">https://www.moodys.com/researchdocumentcontentpage.aspx?</p> <p style="position:absolute;top:558px;left:108px;white-space:nowrap" class="ft06">docid=PBC_1133569</p> <p style="position:absolute;top:558px;left:256px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:588px;left:108px;white-space:nowrap" class="ft03">The Global Scale Credit Rating on this Credit Rating Announcement was issued by one of Moody’s</p> <p style="position:absolute;top:607px;left:108px;white-space:nowrap" class="ft03">affiliates outside the EU and is endorsed by Moody’s Deutschland GmbH, An der Welle 5, Frankfurt</p> <p style="position:absolute;top:627px;left:108px;white-space:nowrap" class="ft03">am Main 60322, Germany, in accordance with Art.4 paragraph 3 of the Regulation (EC) No</p> <p style="position:absolute;top:646px;left:108px;white-space:nowrap" class="ft03">1060/2009 on Credit Rating Agencies. Further information on the EU endorsement status and on the</p> <p style="position:absolute;top:666px;left:108px;white-space:nowrap" class="ft05">Moody’s office that issued the credit rating is available on www.moodys.com.<br/>Please see www.moodys.com for any updates on changes to the lead rating analyst and to the</p> <p style="position:absolute;top:716px;left:108px;white-space:nowrap" class="ft05">Moody's legal entity that has issued the rating.<br/>Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory</p> <p style="position:absolute;top:765px;left:108px;white-space:nowrap" class="ft05">disclosures for each credit rating.<br/>Paulette Truman</p> <p style="position:absolute;top:815px;left:108px;white-space:nowrap" class="ft03">VP-Senior Analyst</p> <p style="position:absolute;top:835px;left:108px;white-space:nowrap" class="ft03">Financial Institutions Group</p> <p style="position:absolute;top:854px;left:108px;white-space:nowrap" class="ft03">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:874px;left:108px;white-space:nowrap" class="ft03">250 Greenwich Street</p> <p style="position:absolute;top:893px;left:108px;white-space:nowrap" class="ft03">New York, NY 10007</p> <p style="position:absolute;top:913px;left:108px;white-space:nowrap" class="ft03">U.S.A.</p> <p style="position:absolute;top:932px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:952px;left:108px;white-space:nowrap" class="ft05">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Sarah Hibler</p> <p style="position:absolute;top:1002px;left:108px;white-space:nowrap" class="ft03">Associate Managing Director</p> <p style="position:absolute;top:1021px;left:108px;white-space:nowrap" class="ft03">Financial Institutions Group</p> <p style="position:absolute;top:1041px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> </div> <!-- Page 4 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft07{font-size:13px;line-height:23px;font-family:Times;color:#0d0c0c;} --> </style> <div id="page4-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003099004.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft05">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Releasing Office:</p> <p style="position:absolute;top:163px;left:108px;white-space:nowrap" class="ft03">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:183px;left:108px;white-space:nowrap" class="ft03">250 Greenwich Street</p> <p style="position:absolute;top:202px;left:108px;white-space:nowrap" class="ft03">New York, NY 10007</p> <p style="position:absolute;top:222px;left:108px;white-space:nowrap" class="ft03">U.S.A.</p> <p style="position:absolute;top:241px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft03">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo></p> <p style="position:absolute;top:357px;left:108px;white-space:nowrap" class="ft03">© 2020 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their</p> <p style="position:absolute;top:377px;left:108px;white-space:nowrap" class="ft07">licensors and affiliates (collectively, “MOODY’S”). All rights reserved.<br/>CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND/OR ITS CREDIT</p> <p style="position:absolute;top:419px;left:108px;white-space:nowrap" class="ft03">RATINGS AFFILIATES ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE</p> <p style="position:absolute;top:439px;left:108px;white-space:nowrap" class="ft03">CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES,</p> <p style="position:absolute;top:458px;left:108px;white-space:nowrap" class="ft03">AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY’S</p> <p style="position:absolute;top:478px;left:108px;white-space:nowrap" class="ft03">(COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. MOODY’S</p> <p style="position:absolute;top:497px;left:108px;white-space:nowrap" class="ft03">INVESTORS SERVICE DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT</p> <p style="position:absolute;top:517px;left:108px;white-space:nowrap" class="ft03">MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY</p> <p style="position:absolute;top:536px;left:108px;white-space:nowrap" class="ft03">ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY’S</p> <p style="position:absolute;top:556px;left:108px;white-space:nowrap" class="ft03">RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES</p> <p style="position:absolute;top:575px;left:108px;white-space:nowrap" class="ft03">OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S INVESTORS</p> <p style="position:absolute;top:595px;left:108px;white-space:nowrap" class="ft03">SERVICE CREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK,</p> <p style="position:absolute;top:614px;left:108px;white-space:nowrap" class="ft03">INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE</p> <p style="position:absolute;top:634px;left:108px;white-space:nowrap" class="ft03">VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND OTHER</p> <p style="position:absolute;top:653px;left:108px;white-space:nowrap" class="ft03">OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT</p> <p style="position:absolute;top:673px;left:108px;white-space:nowrap" class="ft03">OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE</p> <p style="position:absolute;top:692px;left:108px;white-space:nowrap" class="ft03">MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY</p> <p style="position:absolute;top:712px;left:108px;white-space:nowrap" class="ft03">PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY’S CREDIT</p> <p style="position:absolute;top:731px;left:108px;white-space:nowrap" class="ft03">RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE</p> <p style="position:absolute;top:751px;left:108px;white-space:nowrap" class="ft03">OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S CREDIT RATINGS,</p> <p style="position:absolute;top:770px;left:108px;white-space:nowrap" class="ft03">ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT AND DO NOT PROVIDE</p> <p style="position:absolute;top:790px;left:108px;white-space:nowrap" class="ft03">RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. MOODY’S</p> <p style="position:absolute;top:809px;left:108px;white-space:nowrap" class="ft03">CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT</p> <p style="position:absolute;top:829px;left:108px;white-space:nowrap" class="ft03">COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR.</p> <p style="position:absolute;top:848px;left:108px;white-space:nowrap" class="ft03">MOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND</p> <p style="position:absolute;top:868px;left:108px;white-space:nowrap" class="ft03">PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH</p> <p style="position:absolute;top:887px;left:108px;white-space:nowrap" class="ft03">INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH</p> <p style="position:absolute;top:907px;left:108px;white-space:nowrap" class="ft07">SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.<br/>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS</p> <p style="position:absolute;top:949px;left:108px;white-space:nowrap" class="ft03">ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS</p> <p style="position:absolute;top:969px;left:108px;white-space:nowrap" class="ft03">AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS,</p> <p style="position:absolute;top:988px;left:108px;white-space:nowrap" class="ft03">ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT</p> <p style="position:absolute;top:1008px;left:108px;white-space:nowrap" class="ft03">DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER</p> <p style="position:absolute;top:1027px;left:108px;white-space:nowrap" class="ft03">PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED</p> <p style="position:absolute;top:1047px;left:108px;white-space:nowrap" class="ft03">BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH</p> </div> <!-- Page 5 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;}--> </style> <div id="page5-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003099005.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft03">TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft03">FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft03">OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S</p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft07">PRIOR WRITTEN CONSENT.<br/>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE</p> <p style="position:absolute;top:234px;left:108px;white-space:nowrap" class="ft03">NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED</p> <p style="position:absolute;top:254px;left:108px;white-space:nowrap" class="ft03">FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT</p> <p style="position:absolute;top:273px;left:108px;white-space:nowrap" class="ft07">IN THEM BEING CONSIDERED A BENCHMARK.<br/>All information contained herein is obtained by MOODY’S from sources believed by it to be</p> <p style="position:absolute;top:316px;left:108px;white-space:nowrap" class="ft03">accurate and reliable. Because of the possibility of human or mechanical error as well as other</p> <p style="position:absolute;top:335px;left:108px;white-space:nowrap" class="ft03">factors, however, all information contained herein is provided “AS IS” without warranty of any kind.</p> <p style="position:absolute;top:355px;left:108px;white-space:nowrap" class="ft03">MOODY'S adopts all necessary measures so that the information it uses in assigning a credit</p> <p style="position:absolute;top:374px;left:108px;white-space:nowrap" class="ft03">rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when</p> <p style="position:absolute;top:394px;left:108px;white-space:nowrap" class="ft03">appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot</p> <p style="position:absolute;top:413px;left:108px;white-space:nowrap" class="ft03">in every instance independently verify or validate information received in the rating process or in</p> <p style="position:absolute;top:433px;left:108px;white-space:nowrap" class="ft07">preparing its Publications.<br/>To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:475px;left:108px;white-space:nowrap" class="ft03">representatives, licensors and suppliers disclaim liability to any person or entity for any indirect,</p> <p style="position:absolute;top:495px;left:108px;white-space:nowrap" class="ft03">special, consequential, or incidental losses or damages whatsoever arising from or in connection</p> <p style="position:absolute;top:514px;left:108px;white-space:nowrap" class="ft03">with the information contained herein or the use of or inability to use any such information, even if</p> <p style="position:absolute;top:534px;left:108px;white-space:nowrap" class="ft03">MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers</p> <p style="position:absolute;top:553px;left:108px;white-space:nowrap" class="ft03">is advised in advance of the possibility of such losses or damages, including but not limited to:</p> <p style="position:absolute;top:573px;left:108px;white-space:nowrap" class="ft03">(a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant</p> <p style="position:absolute;top:592px;left:108px;white-space:nowrap" class="ft07">financial instrument is not the subject of a particular credit rating assigned by MOODY’S.<br/>To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:635px;left:108px;white-space:nowrap" class="ft03">representatives, licensors and suppliers disclaim liability for any direct or compensatory losses</p> <p style="position:absolute;top:654px;left:108px;white-space:nowrap" class="ft03">or damages caused to any person or entity, including but not limited to by any negligence (but</p> <p style="position:absolute;top:674px;left:108px;white-space:nowrap" class="ft03">excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt,</p> <p style="position:absolute;top:693px;left:108px;white-space:nowrap" class="ft03">by law cannot be excluded) on the part of, or any contingency within or beyond the control of,</p> <p style="position:absolute;top:713px;left:108px;white-space:nowrap" class="ft03">MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers,</p> <p style="position:absolute;top:732px;left:108px;white-space:nowrap" class="ft03">arising from or in connection with the information contained herein or the use of or inability to use</p> <p style="position:absolute;top:752px;left:108px;white-space:nowrap" class="ft07">any such information.<br/>NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS,</p> <p style="position:absolute;top:794px;left:108px;white-space:nowrap" class="ft03">COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF</p> <p style="position:absolute;top:814px;left:108px;white-space:nowrap" class="ft03">ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE</p> <p style="position:absolute;top:833px;left:108px;white-space:nowrap" class="ft07">BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.<br/>Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s</p> <p style="position:absolute;top:876px;left:108px;white-space:nowrap" class="ft03">Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and</p> <p style="position:absolute;top:895px;left:108px;white-space:nowrap" class="ft03">municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s</p> <p style="position:absolute;top:915px;left:108px;white-space:nowrap" class="ft03">Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody’s</p> <p style="position:absolute;top:934px;left:108px;white-space:nowrap" class="ft03">Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from</p> <p style="position:absolute;top:954px;left:108px;white-space:nowrap" class="ft03">$1,000 to approximately $2,700,000. MCO and Moody’s investors Service also maintain policies</p> <p style="position:absolute;top:973px;left:108px;white-space:nowrap" class="ft03">and procedures to address the independence of Moody’s Investors Service credit ratings and credit</p> <p style="position:absolute;top:993px;left:108px;white-space:nowrap" class="ft03">rating processes. Information regarding certain affiliations that may exist between directors of MCO</p> <p style="position:absolute;top:1012px;left:108px;white-space:nowrap" class="ft03">and rated entities, and between entities who hold credit ratings from Moody’s Investors Service and</p> <p style="position:absolute;top:1032px;left:108px;white-space:nowrap" class="ft03">have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted</p> </div> <!-- Page 6 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;}--> </style> <div id="page6-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003099006.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">annually at&#160;</p> <p style="position:absolute;top:114px;left:188px;white-space:nowrap" class="ft06">www.moodys.com</p> <p style="position:absolute;top:114px;left:315px;white-space:nowrap" class="ft03">&#160;under the heading “Investor Relations — Corporate Governance —</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft07">Director and Shareholder Affiliation Policy.”<br/>Additional terms for Australia only: Any publication into Australia of this document is pursuant to the</p> <p style="position:absolute;top:176px;left:108px;white-space:nowrap" class="ft03">Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited</p> <p style="position:absolute;top:195px;left:108px;white-space:nowrap" class="ft03">ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136</p> <p style="position:absolute;top:215px;left:108px;white-space:nowrap" class="ft03">972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale</p> <p style="position:absolute;top:234px;left:108px;white-space:nowrap" class="ft03">clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access</p> <p style="position:absolute;top:254px;left:108px;white-space:nowrap" class="ft03">this document from within Australia, you represent to MOODY’S that you are, or are accessing</p> <p style="position:absolute;top:273px;left:108px;white-space:nowrap" class="ft03">the document as a representative of, a “wholesale client” and that neither you nor the entity you</p> <p style="position:absolute;top:293px;left:108px;white-space:nowrap" class="ft03">represent will directly or indirectly disseminate this document or its contents to “retail clients” within</p> <p style="position:absolute;top:312px;left:108px;white-space:nowrap" class="ft03">the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as</p> <p style="position:absolute;top:332px;left:108px;white-space:nowrap" class="ft03">to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or</p> <p style="position:absolute;top:351px;left:108px;white-space:nowrap" class="ft07">any form of security that is available to retail investors.<br/>Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency</p> <p style="position:absolute;top:394px;left:108px;white-space:nowrap" class="ft03">subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc.,</p> <p style="position:absolute;top:413px;left:108px;white-space:nowrap" class="ft03">a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating</p> <p style="position:absolute;top:433px;left:108px;white-space:nowrap" class="ft03">agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization</p> <p style="position:absolute;top:452px;left:108px;white-space:nowrap" class="ft03">(“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-</p> <p style="position:absolute;top:472px;left:108px;white-space:nowrap" class="ft03">NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated</p> <p style="position:absolute;top:491px;left:108px;white-space:nowrap" class="ft03">obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit</p> <p style="position:absolute;top:511px;left:108px;white-space:nowrap" class="ft03">rating agencies registered with the Japan Financial Services Agency and their registration numbers</p> <p style="position:absolute;top:530px;left:108px;white-space:nowrap" class="ft07">are FSA Commissioner (Ratings) No. 2 and 3 respectively.<br/>MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including</p> <p style="position:absolute;top:573px;left:108px;white-space:nowrap" class="ft03">corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated</p> <p style="position:absolute;top:592px;left:108px;white-space:nowrap" class="ft03">by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to</p> <p style="position:absolute;top:612px;left:108px;white-space:nowrap" class="ft03">MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging</p> <p style="position:absolute;top:631px;left:108px;white-space:nowrap" class="ft07">from JPY125,000 to approximately JPY250,000,000.<br/>MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory</p> <p style="position:absolute;top:674px;left:108px;white-space:nowrap" class="ft03">requirements.</p> </div> </body> </html>