Moody’s has agreed to acquire a minority stake in Philippine Rating Services Corporation, or PhilRatings, expanding its network of domestic rating agency affiliates across Asia Pacific.
Manila-based PhilRatings is a domestic credit rating agency serving the Philippines and plays a role in the country’s developing debt capital markets.
Moody’s said it will bring global rating standards, technical support and broader credit expertise to the relationship while PhilRatings contributes specialized knowledge of the Philippine market.
The investment comes as domestic capital markets become increasingly important sources of funding across Southeast Asia.
Domestic corporate bonds outstanding across ASEAN are more than twice the size of cross-border holdings, while the Philippines has more than $100 billion of planned infrastructure investment over the next three years. Moody’s believes continued development of the domestic bond market can provide issuers with additional funding options while increasing the importance of independent ratings and research.
PhilRatings will continue operating independently following the investment, retaining its existing management, governance and credit rating processes.
Moody’s Ratings said it will become the first global credit rating agency to invest in a domestic credit rating agency in the Philippines. Financial terms were not disclosed.
The transaction gives Moody’s another local-market relationship in Asia Pacific while providing PhilRatings access to the global firm’s technical resources and rating expertise as Philippine debt markets expand.
KEY QUOTES:
“Strong domestic debt markets are essential to supporting sustainable economic growth. PhilRatings has built deep insight into the local market, and its ratings serve as a strong complement to Moody’s global views on credit for investors in the Philippines.”
Wendy Cheong, Managing Director and Regional Head of Asia Pacific at Moody’s Ratings
“Moody’s Ratings’ global standards, best practices and technical support will help us advance our mission to strengthen the credit market infrastructure in the Philippines. Moody’s role as a minority stakeholder reinforces our commitment to trust, credibility, and best-in-class credit ratings and research for the Philippine market.”
Angelica B. Viloria, President of PhilRatings
