U.S. Markets closed
  • S&P 500

    3,768.25
    -27.29 (-0.72%)
     
  • Dow 30

    30,814.26
    -177.26 (-0.57%)
     
  • Nasdaq

    12,998.50
    -114.14 (-0.87%)
     
  • Russell 2000

    2,123.20
    -32.15 (-1.49%)
     
  • Crude Oil

    52.04
    -1.53 (-2.86%)
     
  • Gold

    1,827.70
    -23.70 (-1.28%)
     
  • Silver

    24.83
    -0.97 (-3.77%)
     
  • EUR/USD

    1.2085
    -0.0079 (-0.6526%)
     
  • 10-Yr Bond

    1.0970
    -0.0320 (-2.83%)
     
  • Vix

    24.34
    +1.09 (+4.69%)
     
  • GBP/USD

    1.3583
    -0.0057 (-0.4143%)
     
  • USD/JPY

    103.8710
    +0.0290 (+0.0279%)
     
  • BTC-USD

    36,213.62
    -1,625.02 (-4.29%)
     
  • CMC Crypto 200

    693.09
    -42.05 (-5.72%)
     
  • FTSE 100

    6,735.71
    -66.25 (-0.97%)
     
  • Nikkei 225

    28,519.18
    -179.08 (-0.62%)
     

Moody's - Negative 2021 outlook for German regional governments reflects lower tax revenues and high countercyclical spending

·22 min read

<!DOCTYPE html> <html lang="" xml:lang=""> <head> <title>/nwsys/www/images/PBC_1259778</title> <meta http-equiv="Content-Type" content="text/html; charset=UTF-8"/> <meta name="generator" content="pdftohtml 0.36"/> <meta name="date" content="2021-01-11T04:20:25+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:13px;font-family:Times;color:#0d0c0c;} .ft03{font-size:13px;font-family:Times;color:#000000;} .ft04{font-size:13px;font-family:Times;color:#1b62b7;} .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/PBC_1259778001.png" alt="background image"/> <p style="position:absolute;top:155px;left:108px;white-space:nowrap" class="ft00"><b>Research Announcement:&#160;</b></p> <p style="position:absolute;top:155px;left:364px;white-space:nowrap" class="ft01"><b>Moody's - Negative 2021 outlook for</b></p> <p style="position:absolute;top:180px;left:108px;white-space:nowrap" class="ft01"><b>German regional governments reflects lower tax revenues and high</b></p> <p style="position:absolute;top:204px;left:108px;white-space:nowrap" class="ft01"><b>countercyclical spending</b></p> <p style="position:absolute;top:268px;left:108px;white-space:nowrap" class="ft02">Frankfurt am Main, January 11, 2021 --</p> <p style="position:absolute;top:299px;left:108px;white-space:nowrap" class="ft03">»&#160;Germany’s economic recovery will barely restore tax revenues, while expenses for Länder remain</p> <p style="position:absolute;top:318px;left:127px;white-space:nowrap" class="ft03">high</p> <p style="position:absolute;top:348px;left:108px;white-space:nowrap" class="ft03">»&#160;Debt will rise as debt brake remains suspended in 2021</p> <p style="position:absolute;top:384px;left:108px;white-space:nowrap" class="ft02">The negative 2021 outlook for German regional governments (Länder) is driven by lower tax revenue</p> <p style="position:absolute;top:404px;left:108px;white-space:nowrap" class="ft02">trajectory and high countercyclical spending linked to the coronavirus pandemic, Moody’s Investors</p> <p style="position:absolute;top:423px;left:108px;white-space:nowrap" class="ft05">Service said in a report today.<br/>With economic growth dynamic at a lower pace than expected pre-coronavirus crisis, tax revenues</p> <p style="position:absolute;top:473px;left:108px;white-space:nowrap" class="ft02">won’t fully reach 2019 levels this year, while regions also face operating and capital expense</p> <p style="position:absolute;top:492px;left:108px;white-space:nowrap" class="ft05">pressures amid efforts to stimulate their economies.<br/>“Germany’s economic recovery will barely restore tax revenues in 2021,” said Tamas Fuszenecker,</p> <p style="position:absolute;top:542px;left:108px;white-space:nowrap" class="ft02">a Moody’s Analyst and the report’s author. “Regional governments’ increasing personnel costs and</p> <p style="position:absolute;top:562px;left:108px;white-space:nowrap" class="ft02">continued stimulus measures for regional economies will drive high expenses. The exemption to the</p> <p style="position:absolute;top:581px;left:108px;white-space:nowrap" class="ft05">country’s debt brake mechanism will allow regional governments to increase their debt further.”<br/>Funding needs to cover likely financing deficits are anticipated to remain high around €24 billion in</p> <p style="position:absolute;top:631px;left:108px;white-space:nowrap" class="ft02">2021 and €21 billion in 2022, decreasing from an expected €41 billion peak in 2020. Refinancing</p> <p style="position:absolute;top:651px;left:108px;white-space:nowrap" class="ft02">needs will likely amount to €61 billion and €57 billion respectively over the next two years, down from</p> <p style="position:absolute;top:670px;left:108px;white-space:nowrap" class="ft05">€74 billion in 2020.<br/>Favourable market conditions in 2021 will allow regional governments to lock in cheap funding and</p> <p style="position:absolute;top:720px;left:108px;white-space:nowrap" class="ft05">ease the refinancing of maturing debt.<br/>Subscribers can access the report at:&#160;</p> <p style="position:absolute;top:750px;left:372px;white-space:nowrap" class="ft04">http://www.moodys.com/researchdocumentcontentpage.aspx?</p> <p style="position:absolute;top:770px;left:108px;white-space:nowrap" class="ft04">docid=PBC_1258019</p> <p style="position:absolute;top:800px;left:108px;white-space:nowrap" class="ft02">NOTE TO JOURNALISTS ONLY: For more information, please call one of our global</p> <p style="position:absolute;top:819px;left:108px;white-space:nowrap" class="ft02">press information hotlines: New York <PhoneNo>+1-212-553-0376</PhoneNo>, London <PhoneNo>+44-20-7772-5456</PhoneNo>, Tokyo</p> <p style="position:absolute;top:839px;left:108px;white-space:nowrap" class="ft02"><PhoneNo>+813-5408-4110</PhoneNo>, Hong Kong <PhoneNo>+852-3758-1350</PhoneNo>, Sydney <PhoneNo>+61-2-9270-8141</PhoneNo>, Mexico City</p> <p style="position:absolute;top:858px;left:108px;white-space:nowrap" class="ft02"><PhoneNo>001-888-779-5833</PhoneNo>, São Paulo <PhoneNo>0800-891-2518</PhoneNo>, or Buenos Aires <PhoneNo>0800-666-3506</PhoneNo>. You can also email</p> <p style="position:absolute;top:878px;left:108px;white-space:nowrap" class="ft05">us at mediarelations@moodys.com or visit our web site at www.moodys.com.<br/>This publication does not announce a credit rating action. For any credit ratings referenced in this</p> <p style="position:absolute;top:928px;left:108px;white-space:nowrap" class="ft02">publication, please see the ratings tab on the issuer/entity page on&#160;</p> <p style="position:absolute;top:928px;left:574px;white-space:nowrap" class="ft04">www.moodys.com</p> <p style="position:absolute;top:928px;left:701px;white-space:nowrap" class="ft02">&#160;for the most</p> <p style="position:absolute;top:947px;left:108px;white-space:nowrap" class="ft05">updated credit rating action information and rating history.<br/>Tamas Fuszenecker</p> <p style="position:absolute;top:997px;left:108px;white-space:nowrap" class="ft02">Analyst</p> <p style="position:absolute;top:1017px;left:108px;white-space:nowrap" class="ft02">Subsovereign</p> <p style="position:absolute;top:1036px;left:108px;white-space:nowrap" class="ft02">Moody's Deutschland GmbH</p> </div> <!-- Page 2 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft06{font-size:13px;font-family:Times;color:#0d0c0c;} .ft07{font-size:13px;line-height:22px;font-family:Times;color:#0d0c0c;} --> </style> <div id="page2-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PBC_1259778002.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft02">JOURNALISTS: 44 20 7772 5456</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft05">Client Service: 44 20 7772 5454<br/>Mauro Crisafulli</p> <p style="position:absolute;top:183px;left:108px;white-space:nowrap" class="ft02">Managing Director</p> <p style="position:absolute;top:202px;left:108px;white-space:nowrap" class="ft02">Subsovereign</p> <p style="position:absolute;top:222px;left:108px;white-space:nowrap" class="ft02">Moody's Italia S.r.l</p> <p style="position:absolute;top:241px;left:108px;white-space:nowrap" class="ft02">JOURNALISTS: 44 20 7772 5456</p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft05">Client Service: 44 20 7772 5454<br/>Releasing Office:</p> <p style="position:absolute;top:311px;left:108px;white-space:nowrap" class="ft02">Moody's Deutschland GmbH</p> <p style="position:absolute;top:330px;left:108px;white-space:nowrap" class="ft02">An der Welle 5</p> <p style="position:absolute;top:350px;left:108px;white-space:nowrap" class="ft02">Frankfurt am Main, 60322</p> <p style="position:absolute;top:369px;left:108px;white-space:nowrap" class="ft02">Germany</p> <p style="position:absolute;top:389px;left:108px;white-space:nowrap" class="ft02">JOURNALISTS: 44 20 7772 5456</p> <p style="position:absolute;top:408px;left:108px;white-space:nowrap" class="ft02">Client Service: 44 20 7772 5454</p> <p style="position:absolute;top:498px;left:108px;white-space:nowrap" class="ft02">© 2021 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their</p> <p style="position:absolute;top:517px;left:108px;white-space:nowrap" class="ft07">licensors and affiliates (collectively, “MOODY’S”). All rights reserved.<br/><b>CREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT</b></p> <p style="position:absolute;top:560px;left:108px;white-space:nowrap" class="ft06"><b>OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS,</b></p> <p style="position:absolute;top:579px;left:108px;white-space:nowrap" class="ft06"><b>OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND</b></p> <p style="position:absolute;top:599px;left:108px;white-space:nowrap" class="ft06"><b>INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE</b></p> <p style="position:absolute;top:618px;left:108px;white-space:nowrap" class="ft06"><b>SUCH CURRENT OPINIONS. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN</b></p> <p style="position:absolute;top:638px;left:108px;white-space:nowrap" class="ft06"><b>ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME</b></p> <p style="position:absolute;top:657px;left:108px;white-space:nowrap" class="ft06"><b>DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT.</b></p> <p style="position:absolute;top:677px;left:108px;white-space:nowrap" class="ft06"><b>SEE APPLICABLE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR</b></p> <p style="position:absolute;top:696px;left:108px;white-space:nowrap" class="ft06"><b>INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED</b></p> <p style="position:absolute;top:716px;left:108px;white-space:nowrap" class="ft06"><b>BY MOODY’S CREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK,</b></p> <p style="position:absolute;top:735px;left:108px;white-space:nowrap" class="ft06"><b>INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE</b></p> <p style="position:absolute;top:755px;left:108px;white-space:nowrap" class="ft06"><b>VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND</b></p> <p style="position:absolute;top:774px;left:108px;white-space:nowrap" class="ft06"><b>OTHER OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS</b></p> <p style="position:absolute;top:794px;left:108px;white-space:nowrap" class="ft06"><b>OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE</b></p> <p style="position:absolute;top:813px;left:108px;white-space:nowrap" class="ft06"><b>QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS</b></p> <p style="position:absolute;top:833px;left:108px;white-space:nowrap" class="ft06"><b>OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES.</b></p> <p style="position:absolute;top:852px;left:108px;white-space:nowrap" class="ft06"><b>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO</b></p> <p style="position:absolute;top:872px;left:108px;white-space:nowrap" class="ft06"><b>NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S</b></p> <p style="position:absolute;top:891px;left:108px;white-space:nowrap" class="ft06"><b>CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT AND</b></p> <p style="position:absolute;top:911px;left:108px;white-space:nowrap" class="ft06"><b>DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR</b></p> <p style="position:absolute;top:930px;left:108px;white-space:nowrap" class="ft06"><b>SECURITIES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND</b></p> <p style="position:absolute;top:950px;left:108px;white-space:nowrap" class="ft06"><b>PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY</b></p> <p style="position:absolute;top:969px;left:108px;white-space:nowrap" class="ft06"><b>PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND</b></p> <p style="position:absolute;top:989px;left:108px;white-space:nowrap" class="ft06"><b>OTHER OPINIONS AND PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND</b></p> <p style="position:absolute;top:1008px;left:108px;white-space:nowrap" class="ft06"><b>UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY</b></p> <p style="position:absolute;top:1028px;left:108px;white-space:nowrap" class="ft06"><b>AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE,</b></p> <p style="position:absolute;top:1047px;left:108px;white-space:nowrap" class="ft06"><b>HOLDING, OR SALE.</b></p> </div> <!-- Page 3 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft08{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/PBC_1259778003.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft02">MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft02">ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft02">AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS,</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft02">ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT</p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft02">DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER</p> <p style="position:absolute;top:211px;left:108px;white-space:nowrap" class="ft08">PROFESSIONAL ADVISER.<br/>ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT</p> <p style="position:absolute;top:254px;left:108px;white-space:nowrap" class="ft02">LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR</p> <p style="position:absolute;top:273px;left:108px;white-space:nowrap" class="ft02">OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED,</p> <p style="position:absolute;top:293px;left:108px;white-space:nowrap" class="ft02">DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR</p> <p style="position:absolute;top:312px;left:108px;white-space:nowrap" class="ft02">ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY</p> <p style="position:absolute;top:332px;left:108px;white-space:nowrap" class="ft08">MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.<br/>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE</p> <p style="position:absolute;top:374px;left:108px;white-space:nowrap" class="ft02">NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED</p> <p style="position:absolute;top:394px;left:108px;white-space:nowrap" class="ft02">FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT</p> <p style="position:absolute;top:413px;left:108px;white-space:nowrap" class="ft08">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:456px;left:108px;white-space:nowrap" class="ft02">accurate and reliable. Because of the possibility of human or mechanical error as well as other</p> <p style="position:absolute;top:475px;left:108px;white-space:nowrap" class="ft02">factors, however, all information contained herein is provided “AS IS” without warranty of any kind.</p> <p style="position:absolute;top:495px;left:108px;white-space:nowrap" class="ft02">MOODY'S adopts all necessary measures so that the information it uses in assigning a credit</p> <p style="position:absolute;top:514px;left:108px;white-space:nowrap" class="ft02">rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when</p> <p style="position:absolute;top:534px;left:108px;white-space:nowrap" class="ft02">appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot</p> <p style="position:absolute;top:553px;left:108px;white-space:nowrap" class="ft02">in every instance independently verify or validate information received in the rating process or in</p> <p style="position:absolute;top:573px;left:108px;white-space:nowrap" class="ft08">preparing its Publications.<br/>To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:615px;left:108px;white-space:nowrap" class="ft02">representatives, licensors and suppliers disclaim liability to any person or entity for any indirect,</p> <p style="position:absolute;top:635px;left:108px;white-space:nowrap" class="ft02">special, consequential, or incidental losses or damages whatsoever arising from or in connection</p> <p style="position:absolute;top:654px;left:108px;white-space:nowrap" class="ft02">with the information contained herein or the use of or inability to use any such information, even if</p> <p style="position:absolute;top:674px;left:108px;white-space:nowrap" class="ft02">MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers</p> <p style="position:absolute;top:693px;left:108px;white-space:nowrap" class="ft02">is advised in advance of the possibility of such losses or damages, including but not limited to:</p> <p style="position:absolute;top:713px;left:108px;white-space:nowrap" class="ft02">(a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant</p> <p style="position:absolute;top:732px;left:108px;white-space:nowrap" class="ft08">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:775px;left:108px;white-space:nowrap" class="ft02">representatives, licensors and suppliers disclaim liability for any direct or compensatory losses</p> <p style="position:absolute;top:794px;left:108px;white-space:nowrap" class="ft02">or damages caused to any person or entity, including but not limited to by any negligence (but</p> <p style="position:absolute;top:814px;left:108px;white-space:nowrap" class="ft02">excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt,</p> <p style="position:absolute;top:833px;left:108px;white-space:nowrap" class="ft02">by law cannot be excluded) on the part of, or any contingency within or beyond the control of,</p> <p style="position:absolute;top:853px;left:108px;white-space:nowrap" class="ft02">MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers,</p> <p style="position:absolute;top:872px;left:108px;white-space:nowrap" class="ft02">arising from or in connection with the information contained herein or the use of or inability to use</p> <p style="position:absolute;top:892px;left:108px;white-space:nowrap" class="ft08">any such information.<br/>NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS,</p> <p style="position:absolute;top:934px;left:108px;white-space:nowrap" class="ft02">COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF</p> <p style="position:absolute;top:954px;left:108px;white-space:nowrap" class="ft02">ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE</p> <p style="position:absolute;top:973px;left:108px;white-space:nowrap" class="ft08">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:1016px;left:108px;white-space:nowrap" class="ft02">Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and</p> <p style="position:absolute;top:1035px;left:108px;white-space:nowrap" class="ft02">municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s</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/PBC_1259778004.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft02">Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody’s</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft02">Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft02">$1,000 to approximately $5,000,000. MCO and Moody’s Investors Service also maintain policies</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft02">and procedures to address the independence of Moody’s Investors Service credit ratings and credit</p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft02">rating processes. Information regarding certain affiliations that may exist between directors of MCO</p> <p style="position:absolute;top:211px;left:108px;white-space:nowrap" class="ft02">and rated entities, and between entities who hold credit ratings from Moody’s Investors Service and</p> <p style="position:absolute;top:231px;left:108px;white-space:nowrap" class="ft02">have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted</p> <p style="position:absolute;top:250px;left:108px;white-space:nowrap" class="ft02">annually at&#160;</p> <p style="position:absolute;top:250px;left:188px;white-space:nowrap" class="ft04">www.moodys.com</p> <p style="position:absolute;top:250px;left:315px;white-space:nowrap" class="ft02">&#160;under the heading “Investor Relations — Corporate Governance —</p> <p style="position:absolute;top:270px;left:108px;white-space:nowrap" class="ft08">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:312px;left:108px;white-space:nowrap" class="ft02">Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited</p> <p style="position:absolute;top:332px;left:108px;white-space:nowrap" class="ft02">ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136</p> <p style="position:absolute;top:351px;left:108px;white-space:nowrap" class="ft02">972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale</p> <p style="position:absolute;top:371px;left:108px;white-space:nowrap" class="ft02">clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access</p> <p style="position:absolute;top:390px;left:108px;white-space:nowrap" class="ft02">this document from within Australia, you represent to MOODY’S that you are, or are accessing</p> <p style="position:absolute;top:410px;left:108px;white-space:nowrap" class="ft02">the document as a representative of, a “wholesale client” and that neither you nor the entity you</p> <p style="position:absolute;top:429px;left:108px;white-space:nowrap" class="ft02">represent will directly or indirectly disseminate this document or its contents to “retail clients” within</p> <p style="position:absolute;top:449px;left:108px;white-space:nowrap" class="ft02">the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as</p> <p style="position:absolute;top:468px;left:108px;white-space:nowrap" class="ft02">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:488px;left:108px;white-space:nowrap" class="ft08">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:530px;left:108px;white-space:nowrap" class="ft02">subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc.,</p> <p style="position:absolute;top:550px;left:108px;white-space:nowrap" class="ft02">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:569px;left:108px;white-space:nowrap" class="ft02">agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization</p> <p style="position:absolute;top:589px;left:108px;white-space:nowrap" class="ft02">(“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-</p> <p style="position:absolute;top:608px;left:108px;white-space:nowrap" class="ft02">NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated</p> <p style="position:absolute;top:628px;left:108px;white-space:nowrap" class="ft02">obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit</p> <p style="position:absolute;top:647px;left:108px;white-space:nowrap" class="ft02">rating agencies registered with the Japan Financial Services Agency and their registration numbers</p> <p style="position:absolute;top:667px;left:108px;white-space:nowrap" class="ft08">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:709px;left:108px;white-space:nowrap" class="ft02">corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated</p> <p style="position:absolute;top:729px;left:108px;white-space:nowrap" class="ft02">by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to</p> <p style="position:absolute;top:748px;left:108px;white-space:nowrap" class="ft02">MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging</p> <p style="position:absolute;top:768px;left:108px;white-space:nowrap" class="ft08">from JPY125,000 to approximately JPY550,000,000.<br/>MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory</p> <p style="position:absolute;top:810px;left:108px;white-space:nowrap" class="ft02">requirements.</p> </div> </body> </html>