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Oil Insurance Limited -- Moody’s affirms Oil Insurance Limited’s A2 IFS rating; outlook stable

·32 min read

<!DOCTYPE html> <html lang="" xml:lang=""> <head> <title>/nwsys/www/images/PR_1000004170</title> <meta http-equiv="Content-Type" content="text/html; charset=UTF-8"/> <meta name="generator" content="pdftohtml 0.36"/> <meta name="date" content="2021-01-27T16:13:24+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_1000004170001.png" alt="background image"/> <p style="position:absolute;top:163px;left:108px;white-space:nowrap" class="ft00"><b>Rating Action:&#160;</b></p> <p style="position:absolute;top:163px;left:252px;white-space:nowrap" class="ft01"><b>Moody’s affirms Oil Insurance Limited’s A2 IFS rating;</b></p> <p style="position:absolute;top:187px;left:108px;white-space:nowrap" class="ft01"><b>outlook stable</b></p> <p style="position:absolute;top:234px;left:108px;white-space:nowrap" class="ft02"><b>27 January 2021</b></p> <p style="position:absolute;top:267px;left:108px;white-space:nowrap" class="ft03">New York, January 27, 2021 – Moody’s Investors Service, (“Moody’s”) has affirmed the A2 insurance</p> <p style="position:absolute;top:287px;left:108px;white-space:nowrap" class="ft03">financial strength (IFS) rating of Oil Insurance Limited (“OIL”). The outlook for the rating remains</p> <p style="position:absolute;top:306px;left:108px;white-space:nowrap" class="ft04">stable.<br/>RATINGS RATIONALE<br/>According to Moody’s, OIL’s A2 IFS rating reflects the mutual insurance company’s unique structural</p> <p style="position:absolute;top:388px;left:108px;white-space:nowrap" class="ft03">features which include a retrospective loss recovery funding mechanism and strong membership</p> <p style="position:absolute;top:407px;left:108px;white-space:nowrap" class="ft03">support from many of the world’s leading energy companies, as well as the firm’s strong capital</p> <p style="position:absolute;top:427px;left:108px;white-space:nowrap" class="ft03">base, good geographic diversification, efficient operations and strong internal liquidity profile.</p> <p style="position:absolute;top:446px;left:108px;white-space:nowrap" class="ft03">Tempering these strengths are the insurer's significant exposure to large claims associated with</p> <p style="position:absolute;top:466px;left:108px;white-space:nowrap" class="ft03">man-made and natural catastrophes, its moderate product and client diversification relative to other</p> <p style="position:absolute;top:485px;left:108px;white-space:nowrap" class="ft03">specialty insurers, as well as the potential volatility associated with its investment portfolio, which has</p> <p style="position:absolute;top:505px;left:108px;white-space:nowrap" class="ft03">a high weighting of common equities and alternative investments relative to most other traditional</p> <p style="position:absolute;top:524px;left:108px;white-space:nowrap" class="ft05">property/casualty insurers and reinsurers.<br/>Moody’s notes that OIL’s broad policy form and high limits, combined with its higher risk investment</p> <p style="position:absolute;top:574px;left:108px;white-space:nowrap" class="ft03">strategy, can lead to meaningful volatility in net income and equity capitalization. For the nine months</p> <p style="position:absolute;top:594px;left:108px;white-space:nowrap" class="ft03">ended September 30, 2020, OIL reported net income of $5 million (9M2019: $707 million), reflecting</p> <p style="position:absolute;top:613px;left:108px;white-space:nowrap" class="ft03">a modest underwriting profit and investment income that offset year-to-date unrealized losses on</p> <p style="position:absolute;top:633px;left:108px;white-space:nowrap" class="ft03">investments. Despite this volatility, we view OIL’s contractual per occurrence and aggregate limits to</p> <p style="position:absolute;top:652px;left:108px;white-space:nowrap" class="ft05">be manageable within the context of the firm’s capital resources.<br/>OIL’s membership currently consists of 60 energy companies located in the United States, Canada,</p> <p style="position:absolute;top:702px;left:108px;white-space:nowrap" class="ft03">Europe, Australia, Latin America and Asia. OIL’s retrospective rating and premium plan mutualizes</p> <p style="position:absolute;top:722px;left:108px;white-space:nowrap" class="ft03">policy losses and requires that all losses experienced by the company be fully repaid by its members</p> <p style="position:absolute;top:741px;left:108px;white-space:nowrap" class="ft03">over a five-year period based on each member’s allocable portion. While some correlation exists</p> <p style="position:absolute;top:761px;left:108px;white-space:nowrap" class="ft03">among the credit profiles of OIL’s member companies, OIL’s credit exposure is well diversified and</p> <p style="position:absolute;top:780px;left:108px;white-space:nowrap" class="ft03">of good quality, with the weighted average rating of the membership pool in the Baa1 range, with</p> <p style="position:absolute;top:800px;left:108px;white-space:nowrap" class="ft03">approximately 85% rated investment grade on a weighted basis. Additionally, OIL's credit profile</p> <p style="position:absolute;top:819px;left:108px;white-space:nowrap" class="ft03">is enhanced by the ability of the company's board of directors to allocate any unpaid obligations</p> <p style="position:absolute;top:839px;left:108px;white-space:nowrap" class="ft03">from defaulting members to the remaining members. As a result, the mutualization of losses on an</p> <p style="position:absolute;top:858px;left:108px;white-space:nowrap" class="ft03">effectively “joint and several-like” basis reduces the likelihood of a credit loss to OIL on contractually</p> <p style="position:absolute;top:878px;left:108px;white-space:nowrap" class="ft05">due premium payments.<br/>In Moody’s opinion, OIL’s structural features also substantially mitigate the firm’s exposure to</p> <p style="position:absolute;top:927px;left:108px;white-space:nowrap" class="ft03">competitive pressures and volatile pricing trends in the commercial insurance market, as well as</p> <p style="position:absolute;top:947px;left:108px;white-space:nowrap" class="ft03">uncertainty associated with the loss reserving process, as all losses (including adverse loss reserve</p> <p style="position:absolute;top:966px;left:108px;white-space:nowrap" class="ft05">development) are contractually recovered through premiums in future years.<br/>FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING<br/>Given the current rating of OIL and its business and financial profile, Moody’s believes that there is</p> <p style="position:absolute;top:1046px;left:108px;white-space:nowrap" class="ft03">limited potential for upward rating movement. However, Moody’s would view a material reduction in</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_1000004170002.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">the firm’s high risk assets (equities/alternatives and speculative grade bonds) as a percentage of</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft05">shareholders’ equity as an enhancement to the firm’s overall credit profile.<br/>The following factors could result in negative rating pressure or a downgrade: 1) a 20% reduction in</p> <p style="position:absolute;top:183px;left:108px;white-space:nowrap" class="ft03">the firm’s equity capital over a 12 month period (exclusive of underwriting losses); 2) any breakdown</p> <p style="position:absolute;top:202px;left:108px;white-space:nowrap" class="ft03">in the company's post-loss premium recovery mechanism; and 3) a significant reduction in the</p> <p style="position:absolute;top:222px;left:108px;white-space:nowrap" class="ft05">number of OIL members or their weighted average credit rating.<br/>The following rating has been affirmed with a stable outlook:<br/>Oil Insurance Limited – insurance financial strength at A2.<br/>OIL is a Bermuda-based mutual insurance company established to serve certain insurance needs</p> <p style="position:absolute;top:332px;left:108px;white-space:nowrap" class="ft03">of its members (or their insurance affiliates), all of whom are engaged in energy operations. The</p> <p style="position:absolute;top:352px;left:108px;white-space:nowrap" class="ft03">company writes property, well control, non-gradual pollution liability, windstorm, terrorism, cyber</p> <p style="position:absolute;top:371px;left:108px;white-space:nowrap" class="ft03">terrorism, construction and cargo insurance. As of September 30, 2020, OIL had shareholders’</p> <p style="position:absolute;top:391px;left:108px;white-space:nowrap" class="ft05">equity of approximately $3.5 billion.<br/>The principal methodology used in this rating was Reinsurers Methodology published in November</p> <p style="position:absolute;top:441px;left:108px;white-space:nowrap" class="ft03">2019 and available at&#160;</p> <p style="position:absolute;top:441px;left:262px;white-space:nowrap" class="ft06">https://www.moodys.com/viewresearchdoc.aspx?docid=PBC_1187551</p> <p style="position:absolute;top:441px;left:753px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:460px;left:108px;white-space:nowrap" class="ft03">Alternatively, please see Rating Methodologies page on www.moodys.com for a copy of this</p> <p style="position:absolute;top:480px;left:108px;white-space:nowrap" class="ft04">methodology.<br/>REGULATORY DISCLOSURES<br/>For further specification of Moody’s key rating assumptions and sensitivity analysis, see</p> <p style="position:absolute;top:561px;left:108px;white-space:nowrap" class="ft03">the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure</p> <p style="position:absolute;top:581px;left:108px;white-space:nowrap" class="ft03">form. Moody’s Rating Symbols and Definitions can be found at:</p> <p style="position:absolute;top:581px;left:547px;white-space:nowrap" class="ft06">&#160;https://www.moodys.com/</p> <p style="position:absolute;top:600px;left:108px;white-space:nowrap" class="ft06">researchdocumentcontentpage.aspx?docid=PBC_79004</p> <p style="position:absolute;top:600px;left:503px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:630px;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:650px;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:669px;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:689px;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:708px;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:728px;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:747px;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:767px;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:786px;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:806px;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:825px;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:845px;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:864px;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:914px;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:934px;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:953px;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:973px;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:1023px;left:108px;white-space:nowrap" class="ft03">amendment resulting from that disclosure.</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_1000004170003.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft03">This rating is solicited. Please refer to Moody’s Policy for Designating and Assigning Unsolicited</p> <p style="position:absolute;top:133px;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:183px;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:233px;left:108px;white-space:nowrap" class="ft03">credit analysis can be found at&#160;</p> <p style="position:absolute;top:233px;left:325px;white-space:nowrap" class="ft06">https://www.moodys.com/researchdocumentcontentpage.aspx?</p> <p style="position:absolute;top:252px;left:108px;white-space:nowrap" class="ft06">docid=PBC_1243406</p> <p style="position:absolute;top:252px;left:257px;white-space:nowrap" class="ft03">.</p> <p style="position:absolute;top:282px;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:302px;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:321px;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:341px;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:360px;left:108px;white-space:nowrap" class="ft05">Moody’s office that issued the credit rating is available on www.moodys.com.<br/>The Global Scale Credit Rating on this Credit Rating Announcement was issued by one of Moody’s</p> <p style="position:absolute;top:410px;left:108px;white-space:nowrap" class="ft03">affiliates outside the UK and is endorsed by Moody’s Investors Service Limited, One Canada</p> <p style="position:absolute;top:430px;left:108px;white-space:nowrap" class="ft03">Square, Canary Wharf, London E14 5FA under the law applicable to credit rating agencies in the UK.</p> <p style="position:absolute;top:449px;left:108px;white-space:nowrap" class="ft03">Further information on the UK endorsement status and on the Moody’s office that issued the credit</p> <p style="position:absolute;top:469px;left:108px;white-space:nowrap" class="ft05">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:519px;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:568px;left:108px;white-space:nowrap" class="ft05">disclosures for each credit rating.<br/>James Eck</p> <p style="position:absolute;top:618px;left:108px;white-space:nowrap" class="ft03">VP-Sr Credit Officer</p> <p style="position:absolute;top:638px;left:108px;white-space:nowrap" class="ft03">Financial Institutions Group</p> <p style="position:absolute;top:657px;left:108px;white-space:nowrap" class="ft03">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:677px;left:108px;white-space:nowrap" class="ft03">250 Greenwich Street</p> <p style="position:absolute;top:696px;left:108px;white-space:nowrap" class="ft03">New York, NY 10007</p> <p style="position:absolute;top:716px;left:108px;white-space:nowrap" class="ft03">U.S.A.</p> <p style="position:absolute;top:735px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:755px;left:108px;white-space:nowrap" class="ft05">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Marc R. Pinto, CFA</p> <p style="position:absolute;top:804px;left:108px;white-space:nowrap" class="ft03">MD-Financial Institutions</p> <p style="position:absolute;top:824px;left:108px;white-space:nowrap" class="ft03">Financial Institutions Group</p> <p style="position:absolute;top:843px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:863px;left:108px;white-space:nowrap" class="ft05">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Releasing Office:</p> <p style="position:absolute;top:913px;left:108px;white-space:nowrap" class="ft03">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:932px;left:108px;white-space:nowrap" class="ft03">250 Greenwich Street</p> <p style="position:absolute;top:952px;left:108px;white-space:nowrap" class="ft03">New York, NY 10007</p> <p style="position:absolute;top:971px;left:108px;white-space:nowrap" class="ft03">U.S.A.</p> <p style="position:absolute;top:991px;left:108px;white-space:nowrap" class="ft03">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:1010px;left:108px;white-space:nowrap" class="ft03">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo></p> </div> <!-- Page 4 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft07{font-size:13px;font-family:Times;color:#0d0c0c;} .ft08{font-size:13px;line-height:22px;font-family:Times;color:#0d0c0c;} .ft09{font-size:13px;line-height:23px;font-family:Times;color:#0d0c0c;} .ft010{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_1000004170004.png" alt="background image"/> <p style="position:absolute;top:180px;left:108px;white-space:nowrap" class="ft03">© 2021 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their</p> <p style="position:absolute;top:199px;left:108px;white-space:nowrap" class="ft08">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:241px;left:108px;white-space:nowrap" class="ft07"><b>OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS,</b></p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft07"><b>OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND</b></p> <p style="position:absolute;top:280px;left:108px;white-space:nowrap" class="ft07"><b>INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE</b></p> <p style="position:absolute;top:300px;left:108px;white-space:nowrap" class="ft07"><b>SUCH CURRENT OPINIONS. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN</b></p> <p style="position:absolute;top:319px;left:108px;white-space:nowrap" class="ft07"><b>ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME</b></p> <p style="position:absolute;top:339px;left:108px;white-space:nowrap" class="ft07"><b>DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT.</b></p> <p style="position:absolute;top:358px;left:108px;white-space:nowrap" class="ft07"><b>SEE APPLICABLE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR</b></p> <p style="position:absolute;top:378px;left:108px;white-space:nowrap" class="ft07"><b>INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED</b></p> <p style="position:absolute;top:397px;left:108px;white-space:nowrap" class="ft07"><b>BY MOODY’S CREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK,</b></p> <p style="position:absolute;top:417px;left:108px;white-space:nowrap" class="ft07"><b>INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE</b></p> <p style="position:absolute;top:436px;left:108px;white-space:nowrap" class="ft07"><b>VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND</b></p> <p style="position:absolute;top:456px;left:108px;white-space:nowrap" class="ft07"><b>OTHER OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS</b></p> <p style="position:absolute;top:475px;left:108px;white-space:nowrap" class="ft07"><b>OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE</b></p> <p style="position:absolute;top:495px;left:108px;white-space:nowrap" class="ft07"><b>QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS</b></p> <p style="position:absolute;top:514px;left:108px;white-space:nowrap" class="ft07"><b>OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES.</b></p> <p style="position:absolute;top:534px;left:108px;white-space:nowrap" class="ft07"><b>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO</b></p> <p style="position:absolute;top:553px;left:108px;white-space:nowrap" class="ft07"><b>NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S</b></p> <p style="position:absolute;top:573px;left:108px;white-space:nowrap" class="ft07"><b>CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT AND</b></p> <p style="position:absolute;top:592px;left:108px;white-space:nowrap" class="ft07"><b>DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR</b></p> <p style="position:absolute;top:612px;left:108px;white-space:nowrap" class="ft07"><b>SECURITIES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND</b></p> <p style="position:absolute;top:631px;left:108px;white-space:nowrap" class="ft07"><b>PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY</b></p> <p style="position:absolute;top:651px;left:108px;white-space:nowrap" class="ft07"><b>PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND</b></p> <p style="position:absolute;top:670px;left:108px;white-space:nowrap" class="ft07"><b>OTHER OPINIONS AND PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND</b></p> <p style="position:absolute;top:690px;left:108px;white-space:nowrap" class="ft07"><b>UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY</b></p> <p style="position:absolute;top:709px;left:108px;white-space:nowrap" class="ft07"><b>AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE,</b></p> <p style="position:absolute;top:729px;left:108px;white-space:nowrap" class="ft09"><b>HOLDING, OR SALE.<br/></b>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS</p> <p style="position:absolute;top:772px;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:791px;left:108px;white-space:nowrap" class="ft03">AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS,</p> <p style="position:absolute;top:811px;left:108px;white-space:nowrap" class="ft03">ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT</p> <p style="position:absolute;top:830px;left:108px;white-space:nowrap" class="ft03">DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER</p> <p style="position:absolute;top:850px;left:108px;white-space:nowrap" class="ft010">PROFESSIONAL ADVISER.<br/>ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT</p> <p style="position:absolute;top:892px;left:108px;white-space:nowrap" class="ft03">LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR</p> <p style="position:absolute;top:912px;left:108px;white-space:nowrap" class="ft03">OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED,</p> <p style="position:absolute;top:931px;left:108px;white-space:nowrap" class="ft03">DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR</p> <p style="position:absolute;top:951px;left:108px;white-space:nowrap" class="ft03">ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY</p> <p style="position:absolute;top:970px;left:108px;white-space:nowrap" class="ft010">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:1013px;left:108px;white-space:nowrap" class="ft03">NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED</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_1000004170005.png" alt="background image"/> <p style="position:absolute;top:114px;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:133px;left:108px;white-space:nowrap" class="ft010">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:176px;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:195px;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:215px;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:234px;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:254px;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:273px;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:293px;left:108px;white-space:nowrap" class="ft010">preparing its Publications.<br/>To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:335px;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:355px;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:374px;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:394px;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:413px;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:433px;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:452px;left:108px;white-space:nowrap" class="ft010">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:495px;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:514px;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:534px;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:553px;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:573px;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:592px;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:612px;left:108px;white-space:nowrap" class="ft010">any such information.<br/>NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS,</p> <p style="position:absolute;top:654px;left:108px;white-space:nowrap" class="ft03">COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF</p> <p style="position:absolute;top:674px;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:693px;left:108px;white-space:nowrap" class="ft010">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:736px;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:755px;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:775px;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:794px;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:814px;left:108px;white-space:nowrap" class="ft03">$1,000 to approximately $5,000,000. MCO and Moody’s Investors Service also maintain policies</p> <p style="position:absolute;top:833px;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:853px;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:872px;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:892px;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:911px;left:108px;white-space:nowrap" class="ft03">annually at&#160;</p> <p style="position:absolute;top:911px;left:188px;white-space:nowrap" class="ft06">www.moodys.com</p> <p style="position:absolute;top:911px;left:315px;white-space:nowrap" class="ft03">&#160;under the heading “Investor Relations — Corporate Governance —</p> <p style="position:absolute;top:931px;left:108px;white-space:nowrap" class="ft010">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:973px;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:993px;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:1012px;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:1032px;left:108px;white-space:nowrap" class="ft03">clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access</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_1000004170006.png" alt="background image"/> <p style="position:absolute;top:114px;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:133px;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:153px;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:172px;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:192px;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:211px;left:108px;white-space:nowrap" class="ft010">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:254px;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:273px;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:293px;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:312px;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:332px;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:351px;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:371px;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:390px;left:108px;white-space:nowrap" class="ft010">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:433px;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:452px;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:472px;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:491px;left:108px;white-space:nowrap" class="ft010">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:534px;left:108px;white-space:nowrap" class="ft03">requirements.</p> </div> </body> </html>