Fitch rates United Overseas Bank notes A+

Fitch Ratings said it assigned an expected A+ rating to based United Overseas Bank Ltd.'s proposed Singapore dollar-denominated Basel III-compliant tier 2 subordinated notes.

The notes will be issued under the bank's S$15 billion euro medium-term note program.

The securities are rated one notch below the bank’s AA- viability rating.

This reflects their higher loss-severity risk relative to senior unsecured instruments, which is due to their subordinated status, presence of a non-viability clause and the partial, rather than mandatory full write-down feature at the point of non-viability, Fitch said.

A change in the bank’s viability rating will impact the securities' rating as that is the anchor rating off which the securities are notched down.

The bank also has a long-term issuer default rating of AA- and short-term issuer default rating of F1+, Fitch said.

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