Moody's: Most Chinese issuers resilient to credit pressures of China's economic rebalancing

Moody's Investors Service says that the vast majority of Chinese issuers that it rates are resilient to the associated near-term credit pressures of China's economic rebalancing.

"The key dynamics of China's rebalancing process - decelerating headline growth, economic restructuring, policy reform and slower credit uptake - are starting to gain traction, to varying degrees," says Michael Taylor, a Moody's Managing Director and Chief Credit Officer for Asia Pacific.

"However, the vast majority of our ratings have remained stable over the past 12 months, with downgrades and defaults typically isolated instances rather than symptomatic of systemic risks," adds Taylor. "We continue to envisage a stable outlook, although with a negative bias, for our rated portfolio in 2015, even as growth continues to slow."

Moody's analysis is contained in its latest edition of Inside Asia, a quarterly publication highlighting its credit analysis and research across sovereigns, corporates, financial institutions and structured finance credits across the region.

Moody's publication shows that 85% of rating outlooks for Chinese corporate and financial issuers are stable, 13% are negative, and 2% are positive.

Moody's report also look at how Asia's sound fundamentals are likely to become increasingly evident, as global macroeconomic challenges come to the fore in 2015.

The region is supported by healthy external vulnerability metrics, monetary policy credibility, the positive effects of weaker oil prices and economic reform momentum.

These factors will continue to anchor capital inflows and support overall credit market stability.

Feature articles and research highlights included in this edition of Inside Asia are:

• Most Chinese Issuers Will Continue to Ride Out Challenges from Economic Rebalancing
• Asia's Solid Fundamentals to Support Regional Credit Conditions
• India Budget: Credit Neutral for Sovereign, Positive for Corporates and Infrastructure, and a Mixed Bag for Banks
• China's Regional and Local Governments: Upper Tiers Show High Level of Creditworthiness
• Malaysia's Property Sector Risks Are Manageable for Banks and Developers
• Most Asian Oil & Gas Companies Remain Well-Positioned in Lower Oil Price Environment
• Securitizations Provide Long-Term Funding Option in India

Further data and analysis are covered in the Asia Dashboards section of the latest edition of Inside Asia.

Subscribers can access Inside Asia at: http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_179921