[ET Net News Agency, 19 October 2017] Moody's Investors Service has today affirmed Dah
Sing Bank, Limited's A3 long-term deposit rating and Prime-2 short-term deposit rating.
At the same time, Moody's has affirmed the bank's a3 baseline credit assessment (BCA)
and adjusted BCA, and its A2(cr)/P-1(cr) counterparty risk assessments.
The outlook on Dah Sing Bank's ratings is revised to stable from negative. For a list of
all affected ratings, please refer to the end of this press release.
The affirmation of Dah Sing Bank's ratings with a stable outlook reflects the bank's
resilient performance in recent years, despite subdued economic growth in Hong Kong. The
bank has maintained sound financial metrics with strong asset quality, adequate
capitalization and a good liquidity profile.
The bank has a greater focus on small and medium-sized (SME) lending and has managed the
asset quality on such exposures well. It has maintained impaired loan ratios consistently
below or around 1.0% in recent years. Impaired loan ratio was 0.82% at end-June 2017, down
23bps compared to end-2016, mainly driven by a decrease in impaired loans among its SME
borrowers. Moody's expects the bank's asset risks will likely stabilize on the back of
strong economic growth momentum.
Dah Sing Bank's capital adequacy has improved since 2014, with reported Common Equity
Tier 1 (CET1) ratio of 13.1% at end-June 2017, up from 12.7% at end-2016. We expect
capitalization will be largely stable on the back of subdued loan growth and better
retained earnings.
The bank maintains a sound liquidity profile. As with other Hong Kong banks, the bank is
primarily funded by customer deposits, which accounted for 84.9% of total liabilities at
end-June 2017. (KL)