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CNA Financial Corporation -- Moody’s rates CNA’s senior notes Baa2; outlook stable

·30 min read

<!DOCTYPE html> <html lang="" xml:lang=""> <head> <title>/nwsys/www/images/PR_1000003232</title> <meta http-equiv="Content-Type" content="text/html; charset=UTF-8"/> <meta name="generator" content="pdftohtml 0.36"/> <meta name="date" content="2020-08-11T19:32:03+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_1000003232001.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 rates CNA’s senior notes Baa2; outlook stable</b></p> <p style="position:absolute;top:209px;left:108px;white-space:nowrap" class="ft02"><b>11 August 2020</b></p> <p style="position:absolute;top:242px;left:108px;white-space:nowrap" class="ft03">New York, August 11, 2020 -- Moody’s Investors Service, (“Moody’s”) has assigned a Baa2 rating to</p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft03">$500 million of 10-year senior notes to be issued by CNA Financial Corporation off its multi-purpose</p> <p style="position:absolute;top:281px;left:108px;white-space:nowrap" class="ft03">shelf registration. The company intends to use the net proceeds from the offering to repay $400</p> <p style="position:absolute;top:300px;left:108px;white-space:nowrap" class="ft03">million of senior notes that mature in August 2021 and for general corporate purposes. The rating</p> <p style="position:absolute;top:320px;left:108px;white-space:nowrap" class="ft04">outlook for CNA is stable.<br/>RATINGS RATIONALE<br/>For CNA and other insurers, the coronavirus and related economic downturn continues to constrain</p> <p style="position:absolute;top:402px;left:108px;white-space:nowrap" class="ft03">premium growth, raise claim costs in certain business lines, and add volatility to investment</p> <p style="position:absolute;top:421px;left:108px;white-space:nowrap" class="ft03">performance and capital levels. For the first half of 2020, CNA reported net income of $90 million</p> <p style="position:absolute;top:441px;left:108px;white-space:nowrap" class="ft03">compared to $620 million in the prior year period, with the decline driven by higher catastrophe</p> <p style="position:absolute;top:460px;left:108px;white-space:nowrap" class="ft03">losses and pretax net investment losses of $147 million. The company reported a combined ratio</p> <p style="position:absolute;top:480px;left:108px;white-space:nowrap" class="ft03">of 104.8% in the first half of 2020 compared to 96.8% in the prior year period reflecting $195 million</p> <p style="position:absolute;top:499px;left:108px;white-space:nowrap" class="ft03">in coronavirus related losses stemming from healthcare professional liability with additional impacts</p> <p style="position:absolute;top:519px;left:108px;white-space:nowrap" class="ft03">from workers' compensation, management liability, commercial property, trade credit and surety, as</p> <p style="position:absolute;top:538px;left:108px;white-space:nowrap" class="ft03">well as $61 million from civil unrest, and $120 million primarily from storms and other weather-related</p> <p style="position:absolute;top:558px;left:108px;white-space:nowrap" class="ft03">events. Moody’s expects the company will limit its discretionary spending through the downturn and</p> <p style="position:absolute;top:577px;left:108px;white-space:nowrap" class="ft05">maintain its strong liquidity and capital adequacy.<br/>CNA’s ratings reflect the group's major presence in US commercial and specialty insurance, its</p> <p style="position:absolute;top:627px;left:108px;white-space:nowrap" class="ft03">profitable specialty insurance operations and improving core commercial business, good risk-</p> <p style="position:absolute;top:646px;left:108px;white-space:nowrap" class="ft03">adjusted capitalization, sound liquidity and dividend capacity, and the historically stable and</p> <p style="position:absolute;top:666px;left:108px;white-space:nowrap" class="ft03">supportive parentage in Loews Corporation (senior debt at A3). These credit strengths are tempered</p> <p style="position:absolute;top:685px;left:108px;white-space:nowrap" class="ft03">by the company's exposure to long-tail casualty businesses, which have greater pricing and reserve</p> <p style="position:absolute;top:705px;left:108px;white-space:nowrap" class="ft03">risk, as well as by intrinsic earnings volatility within its legacy long term care business, particularly</p> <p style="position:absolute;top:724px;left:108px;white-space:nowrap" class="ft03">from low interest rates. CNA is also exposed to volatility from natural and man-made catastrophes,</p> <p style="position:absolute;top:744px;left:108px;white-space:nowrap" class="ft05">though lower than more property-focused insurers.<br/>FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING<br/>According to Moody's, factors that could lead to a rating upgrade include: sustained improved</p> <p style="position:absolute;top:824px;left:108px;white-space:nowrap" class="ft03">underwriting performance (e.g. combined ratios in the low 90% range) in commercial insurance;</p> <p style="position:absolute;top:843px;left:108px;white-space:nowrap" class="ft03">together with continued strong profitability in the group's specialty insurance segment; consolidated</p> <p style="position:absolute;top:863px;left:108px;white-space:nowrap" class="ft05">earnings coverage above 7x; significant de-risking or diminished size of the long term care portfolio.<br/>Conversely, factors that could lead to a rating downgrade include: a decline in shareholders' equity of</p> <p style="position:absolute;top:913px;left:108px;white-space:nowrap" class="ft03">10% or more as a result of losses; overall combined ratio consistently above 100%; annual adverse</p> <p style="position:absolute;top:932px;left:108px;white-space:nowrap" class="ft03">reserve development in excess of 3% of total reserves; sustained earnings coverage below 4x and/</p> <p style="position:absolute;top:952px;left:108px;white-space:nowrap" class="ft03">or adjusted financial leverage in excess of 30%; a downgrade of Loews Corporation by more than</p> <p style="position:absolute;top:971px;left:108px;white-space:nowrap" class="ft05">one notch or shareholder dividends significantly in excess of the insurer’s run-rate earnings<br/>Moody's has assigned the following rating:<br/>CNA Financial Corporation - senior unsecured debt at Baa2.</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_1000003232002.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">CNA Financial Corporation is an insurance holding company that is principally engaged in providing</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft03">domestic and international property and casualty insurance and ranks among the 15 largest P&amp;C</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft03">insurers in the US. CNA Financial Corporation is approximately 89.6% owned by Loews Corporation.</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft03">For the first six months of 2020, CNA Financial Corporation reported total revenues of $5.1 billion</p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft05">and net income of $90 million. As of June 30, 2020, shareholders' equity was $11.6 billion.<br/>The principal methodology used in this rating was Property and Casualty Insurers</p> <p style="position:absolute;top:241px;left:108px;white-space:nowrap" class="ft03">Methodology published in November 2019 and available at&#160;</p> <p style="position:absolute;top:241px;left:522px;white-space:nowrap" class="ft06">https://www.moodys.com/</p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft06">researchdocumentcontentpage.aspx?docid=PBC_1187352</p> <p style="position:absolute;top:261px;left:520px;white-space:nowrap" class="ft03">. Alternatively, please see the Rating</p> <p style="position:absolute;top:280px;left:108px;white-space:nowrap" class="ft04">Methodologies page on www.moodys.com for a copy of this methodology.<br/>REGULATORY DISCLOSURES<br/>For further specification of Moody’s key rating assumptions and sensitivity analysis, see</p> <p style="position:absolute;top:362px;left:108px;white-space:nowrap" class="ft03">the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure</p> <p style="position:absolute;top:381px;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:381px;left:551px;white-space:nowrap" class="ft06">https://www.moodys.com/</p> <p style="position:absolute;top:401px;left:108px;white-space:nowrap" class="ft06">researchdocumentcontentpage.aspx?docid=PBC_79004</p> <p style="position:absolute;top:401px;left:503px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:431px;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:451px;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:470px;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:490px;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:509px;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:529px;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> <p style="position:absolute;top:548px;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:568px;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:587px;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:607px;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:626px;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:646px;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:665px;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:715px;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:735px;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:754px;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:774px;left:108px;white-space:nowrap" class="ft05">entity, Disclosure from rated entity.<br/>The rating has been disclosed to the rated entity or its designated agent(s) and issued with no</p> <p style="position:absolute;top:823px;left:108px;white-space:nowrap" class="ft05">amendment resulting from that disclosure.<br/>This rating is solicited. Please refer to Moody’s Policy for Designating and Assigning Unsolicited</p> <p style="position:absolute;top:873px;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:923px;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:973px;left:108px;white-space:nowrap" class="ft03">credit analysis can be found at&#160;</p> <p style="position:absolute;top:973px;left:325px;white-space:nowrap" class="ft06">https://www.moodys.com/researchdocumentcontentpage.aspx?</p> <p style="position:absolute;top:992px;left:108px;white-space:nowrap" class="ft06">docid=PBC_1133569</p> <p style="position:absolute;top:992px;left:256px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:1023px;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:1042px;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> </div> <!-- Page 3 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft07{font-size:13px;line-height:23px;font-family:Times;color:#0d0c0c;} --> </style> <div id="page3-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003232003.png" alt="background image"/> <p style="position:absolute;top:114px;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:133px;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:153px;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:202px;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:252px;left:108px;white-space:nowrap" class="ft05">disclosures for each credit rating.<br/>Jasper Cooper, CFA</p> <p style="position:absolute;top:302px;left:108px;white-space:nowrap" class="ft03">VP-Sr Credit Officer</p> <p style="position:absolute;top:321px;left:108px;white-space:nowrap" class="ft03">Financial Institutions Group</p> <p style="position:absolute;top:341px;left:108px;white-space:nowrap" class="ft03">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:360px;left:108px;white-space:nowrap" class="ft03">250 Greenwich Street</p> <p style="position:absolute;top:380px;left:108px;white-space:nowrap" class="ft03">New York, NY 10007</p> <p style="position:absolute;top:399px;left:108px;white-space:nowrap" class="ft03">U.S.A.</p> <p style="position:absolute;top:419px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:438px;left:108px;white-space:nowrap" class="ft05">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Sarah Hibler</p> <p style="position:absolute;top:488px;left:108px;white-space:nowrap" class="ft03">Associate Managing Director</p> <p style="position:absolute;top:508px;left:108px;white-space:nowrap" class="ft03">Financial Institutions Group</p> <p style="position:absolute;top:527px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:547px;left:108px;white-space:nowrap" class="ft05">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Releasing Office:</p> <p style="position:absolute;top:597px;left:108px;white-space:nowrap" class="ft03">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:616px;left:108px;white-space:nowrap" class="ft03">250 Greenwich Street</p> <p style="position:absolute;top:636px;left:108px;white-space:nowrap" class="ft03">New York, NY 10007</p> <p style="position:absolute;top:655px;left:108px;white-space:nowrap" class="ft03">U.S.A.</p> <p style="position:absolute;top:675px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:694px;left:108px;white-space:nowrap" class="ft03">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo></p> <p style="position:absolute;top:790px;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:810px;left:108px;white-space:nowrap" class="ft07">licensors and affiliates (collectively, “MOODY’S”). 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CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK,</p> <p style="position:absolute;top:1047px;left:108px;white-space:nowrap" class="ft03">INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE</p> </div> <!-- Page 4 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;}--> </style> <div id="page4-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000003232004.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND OTHER</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft03">OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft03">OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft03">MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY</p> <p style="position:absolute;top:192px;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:211px;left:108px;white-space:nowrap" class="ft03">RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE</p> <p style="position:absolute;top:231px;left:108px;white-space:nowrap" class="ft03">OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S CREDIT RATINGS,</p> <p style="position:absolute;top:250px;left:108px;white-space:nowrap" class="ft03">ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT AND DO NOT PROVIDE</p> <p style="position:absolute;top:270px;left:108px;white-space:nowrap" class="ft03">RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. MOODY’S</p> <p style="position:absolute;top:289px;left:108px;white-space:nowrap" class="ft03">CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT</p> <p style="position:absolute;top:309px;left:108px;white-space:nowrap" class="ft03">COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR.</p> <p style="position:absolute;top:328px;left:108px;white-space:nowrap" class="ft03">MOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND</p> <p style="position:absolute;top:348px;left:108px;white-space:nowrap" class="ft03">PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH</p> <p style="position:absolute;top:367px;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:387px;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:429px;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:449px;left:108px;white-space:nowrap" class="ft03">AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS,</p> <p style="position:absolute;top:468px;left:108px;white-space:nowrap" class="ft03">ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT</p> <p style="position:absolute;top:488px;left:108px;white-space:nowrap" class="ft03">DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER</p> <p style="position:absolute;top:507px;left:108px;white-space:nowrap" class="ft03">PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED</p> <p style="position:absolute;top:527px;left:108px;white-space:nowrap" class="ft03">BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH</p> <p style="position:absolute;top:546px;left:108px;white-space:nowrap" class="ft03">INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER</p> <p style="position:absolute;top:566px;left:108px;white-space:nowrap" class="ft03">TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED</p> <p style="position:absolute;top:585px;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:605px;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:624px;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:667px;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:686px;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:706px;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:748px;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:768px;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:787px;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:807px;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:826px;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:846px;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:865px;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:908px;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:927px;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:947px;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:966px;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:986px;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:1005px;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:1025px;left:108px;white-space:nowrap" class="ft03">financial instrument is not the subject of a particular credit rating assigned by MOODY’S.</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_1000003232005.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:133px;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:153px;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:172px;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:192px;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:211px;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:231px;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:250px;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:293px;left:108px;white-space:nowrap" class="ft03">COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF</p> <p style="position:absolute;top:312px;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:332px;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:374px;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:394px;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:413px;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:433px;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:452px;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:472px;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:491px;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:511px;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:530px;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> <p style="position:absolute;top:550px;left:108px;white-space:nowrap" class="ft03">annually at&#160;</p> <p style="position:absolute;top:550px;left:188px;white-space:nowrap" class="ft06">www.moodys.com</p> <p style="position:absolute;top:550px;left:315px;white-space:nowrap" class="ft03">&#160;under the heading “Investor Relations — Corporate Governance —</p> <p style="position:absolute;top:569px;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:612px;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:631px;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:651px;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:670px;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:690px;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:709px;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:729px;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:748px;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:768px;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:787px;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:830px;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:849px;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:869px;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:888px;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:908px;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:927px;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:947px;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:966px;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:1009px;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:1028px;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> </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_1000003232006.png" alt="background image"/> <p style="position:absolute;top:114px;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:133px;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:176px;left:108px;white-space:nowrap" class="ft03">requirements.</p> </div> </body> </html>