Japan-Based SMFG's Proposed Additional Tier 1 Perpetual Notes Assigned 'BB+' Rating

TOKYO (S&P Global Ratings) Feb. 26, 2024--S&P Global Ratings today assigned its 'BB+' long-term issue credit rating to the proposed perpetual, subordinated additional tier 1 (AT1) notes to be issued by Sumitomo Mitsui Financial Group Inc. (SMFG; A-/Stable/--). We understand the issuance will qualify as Basel III-compliant AT1 notes under Japanese regulations. The issue ratings are subject to our review of the notes' final documentation. The issue rating on the AT1 notes to be issued by the non-operating holding company (NOHC) of one of the largest banking groups in Japan is five notches lower than our assessment of SMFG's group stand-alone credit profile (SACP) of 'a'. We believe that extraordinary support from the government would unlikely be available for these

...February 25, 2024 TOKYO (S&P Global Ratings) Feb. 26, 2024--S&P Global Ratings today assigned its '##+' long-term issue credit rating to the proposed perpetual, subordinated additional tier 1 (AT1) notes to be issued by Sumitomo Mitsui Financial Group Inc. (SMFG; A-/Stable/--). We understand the issuance will qualify as Basel III-compliant AT1 notes under Japanese regulations. The issue ratings are subject to our review of the notes' final documentation. The issue rating on the AT1 notes to be issued by the non-operating holding company (NOHC) of one of the largest banking groups in Japan is five notches lower than our assessment of SMFG's group stand-alone credit profile (SACP) of 'a'. We believe that extraordinary support from the government would unlikely be available for these AT1 notes. We use the issuer credit rating we assign SMFG as our starting point. This rating is one notch below the group SACP, because of structural subordination. Overall, the five-notch downward revision from...

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