Mitsubishi UFJ Financial Group Inc. (MUFG; A/Stable/--) concluded a strategic capital alliance with U.S.-based Morgan Stanley (A/Negative/A-1) in October 2008. Standard&Poor's expects the negative impact of MUFG's investment in Morgan Stanley on the bank's capital to be within a manageable level in terms of the current rating. We will scrutinize the impact of any changes in strategy on the company's earnings and financial profile. The rating on MUFG reflects its sound financial profile on a consolidated basis and strong position in the domestic financial market as Japan's largest financial group. However, the long-term counterparty credit rating on MUFG is one notch below the ratings on its core subsidiaries-- Bank of Tokyo-Mitsubishi UFJ Ltd. (BTMU; A+/Stable/A-1) and Mitsubishi UFJ
