The rating on ORIX Corp. reflects the company's strong position in Japan's leasing market and the benefits it derives from a solid customer base, which mainly comprises domestic small and midsize enterprises (SMEs). The company's regional and business diversification also supports the stability of its performance. Its funding base is solid, based on a good relationship with numerous financial institutions and diversified funding sources. These positive factors are offset by the company's relatively weak profitability and capitalization by international standards, in comparison with its business risks. ORIX has been proactive in disposing of bad assets and building up reserves but the company's exposure to the weak domestic real estate sector could result in additional losses in the future. ORIX's position
