Moody’s gives Huarong negative outlook

Moody’s Investors Service said it completed its review for downgrade on China Huarong Asset Management Co., Ltd. and confirmed its Baa2 ratings but assigned a negative outlook. Moody’s started the review on Aug. 19.

Additionally, the agency confirmed the long-term backed senior unsecured debt ratings of Huarong AMC's offshore financing vehicles, including Huarong Finance 2017 Co., Ltd., Huarong Finance II Co., Ltd. and Huarong Finance 2019 Co., Ltd., at Baa3, and their long-term backed senior unsecured medium-term note (MTN) program ratings at (P)Baa3. China Huarong International Holdings Ltd. guarantees the MTNs.

“The negative outlook reflects Moody's expectation that Huarong AMC's financial metrics will continue to face pressure over the next 12-18 months due to China's slowing economic growth, a correction in the property market and disruptions caused by the coronavirus pandemic. It also takes into consideration the uncertainty in the timeliness and form of government support for the company,” Moody’s said in a press release.

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