Update: Mitsubishi UFJ Financial Group Inc. (Holding Company); MUFG Bank Ltd. (Lead Bank)

The stable outlooks on the long-term issuer credit ratings on MUFG and its core subsidiaries, including core operating banks, reflect our view that the group will likely maintain its solid business base, strong funding, and ample liquidity in the next two years. The outlooks also incorporate our view that creditworthiness of companies in the group will remain stable in the next two years, incorporating the likelihood of extraordinary government support. While recovery from the pandemic is only half way, a steeper downturn in the global economy than we assume could pressure the group's profitability and asset quality. However, we expect the likelihood of the group receiving extraordinary government support if required to remain high, counterbalancing the detrimental issues and underpinning

...Mitsubishi UFJ Financial Group Inc. (MUFG) will likely maintain its strong business and favorable financial position as Japan's largest banking group. This is despite concerns about a global economic slowdown. Among Japan's major banking groups, MUFG group has a leading business presence at home and overseas. The group has been restructuring in recent years with the aim of improving profitability and digitally transforming its operations and services. Accordingly, we believe the group will likely remain resilient to declining profitability in Japan's banking industry, as well as to increasing uncertainty in the global economy. The group's risk-adjusted capital (RAC) ratio is likely to remain adequate between 7.2% and 7.7%.in the next two years. Recovering profit in its core business and control of risk-weighted assets (RWA) in its investments will likely support the ratio. Its sale of MUFG Union Bank N.A. (MUB), completed in December 2022, should improve the ratio temporarily, but we expect...

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