Summary: Standard Chartered Bank (Hong Kong) Ltd.

High likelihood of government support due to high systemic importance in Hong Kong. Broad and solid customer deposit base. Strong record of containing credit losses. Strong business stability owing to a long-established franchise. Loan quality exposed to rising economic risk in Hong Kong and China. The stable outlook on Standard Chartered Bank (Hong Kong) Ltd. (SCBHK) reflects our expectation that the bank's stand-alone credit profile (SACP) will remain within the 'a' category and the likelihood of extraordinary government support will stay high over the next 12-24 months. The outlook also mirrors the outlook on the sovereign rating of Hong Kong (AAA/Stable/A-1+; cnAAA/cnA-1+). We believe an upgrade of SCBHK is unlikely over the next two years. We could raise our rating

...Outlook: Stable The stable outlook on Standard Chartered Bank (Hong Kong) Ltd. (SCBHK) reflects our expectation that the bank's stand-alone credit profile (SACP) will remain within the 'a' category and the likelihood of extraordinary government support will stay high over the next 12-24 months. The outlook also mirrors the outlook on the sovereign rating of Hong Kong (###/Stable/A-1+; cnAAA/cnA-1+). We believe an upgrade of SCBHK is unlikely over the next two years. We could raise our rating on SCBHK if we revise our assessment of the bank's SACP by two notches to '##-'. We could downgrade SCBHK if: (i) the bank's SACP weakens by two notches to '###+'; (ii) we believe the likelihood of government support has diminished; or (iii) we downgrade Hong Kong. We could lower SCBHK's SACP by one notch if we revise Hong Kong's economic risk score to '4' from '3' and reclassify Hong Kong's banking system to 'group 3' from 'group 2'. We could also lower SCBHK's SACP if the bank's capital and earnings...

Summary