Moody's: Chinatrust unaffected

Moody's Investors Service said that Chinatrust Financial Holding Co.'s long-term foreign-currency A3 issuer rating is unaffected by its decision to acquire Metlife Taiwan Insurance Co. Ltd.

The outlook is stable.

Chinatrust Commercial Bank's Baa2 long-term scale rating, A2/prime-1 local-currency and foreign-currency long-term/short-term deposit ratings and Baa3 foreign-currency junior subordinated debt rating also are unaffected, Moody's said.

The outlook is stable.

The transaction comprises only 3.3% of the company's equity and the double leverage is expected to be maintained at a healthy level after the merger, the agency said.

But negative pressure could develop if the assets or capital of its insurance business grows to comprise 10% of the group's amount or if its double leverage is increased to more than 120%, Moody's said.

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