FINANCIAL INSTITUTIONSISSUER COMMENT 24 JUNE 2015THE BANK OF TOKYO-MITSUBISHI UFJ, LTD (BTMU)Moodys Senior Unsecured Rating A1Moodys Outlook STABond-Implied Rating Aa2CDS-Implied Rating A2EDF-Implied Rating NAAs of 6/23/2015ANALYST CONTACTSAllerton G. Smith 212-553-4058 Sr Dir-Sr Research Analyst allerton.smith@moodys.comABOUT CAPITAL MARKETS RESEARCHAnalyses from Moodys Capital Markets Research, Inc. (CMR) focus on explaining signals from the credit and equity markets. The publications address whether market signals, in the opinion of the groups analysts, accurately reflect the risks and investment opportunities associated with issuers and sectors. CMR research thus complements the fundamentally-oriented research offered by Moodys Investors Service (MIS), the rating agency.CMR is part of Moodys Analytics, which is one of the two operating businesses of Moodys Corporation. Moodys Analytics (including CMR) is legally and organizationally separated from Moodys Investors Service and operates on an arms length basis from the ratings business. CMR does not provide investment advisory services or products.View the CMR FAQ Contact the CMR team Follow us on TwitterMoodys Analytics markets and distributes all Moodys Capital Markets Research, Inc. materials. Moodys Capital Markets Research, Inc. is a subsidiary of Moodys Corporation. Moodys Analytics does not provide investment advisory services or products. For further detail, please see the last page.Market Signals ReviewThe Bank of Tokyo-Mitsubishi UFJ: Market-Implied Ratings Rebound The bond-implied rating of The Bank of Tokyo-Mitsubishi UFJ, Ltd (BTMU) has rallied off its recent low to Aa2. The CDS-implied rating advanced by two notches from Baa1 to A2.Mitsubishi UFJ Financial Group, Inc., the parent company of BTMU with assets of $2.33 trillion, is one of the ten largest banking organizations in the world (Appendix 1).FIGURE 1. BTMU: MOODYS AND MARKET-IMPLIED RATINGS, LAST 90 DAYS (WEEKLY DATA)The banks bond-implied rating was Aa3 three months ago. Since then it has dipped as far down as Baa1, and climbed on two occasions to Aa2. Today it stands at Aa2, one notch above its level on April 22 and five notches higher than its most recent low point (Figure 1).MOODY'S ANALYTICS FINANCIAL INSTITUTIONS2 24 JUNE 2015 MARKET SIGNALS REVIEW : THE BANK OF TOKYO-MITSUBISHI UFJ: MARKET-IMPLIED RATINGS REBOUNDThe CDS-implied rating was Baa1 three months ago. Presently it stands at A2, its best showing since October of 2014.BTMU has no publically traded equity. As such, we do not publish an EDF metric or EDF-implied rating for the bank. Please see the discussion below on the EDF measures for Mitsubishi UFJ Financial Group, Inc.According to our ratings gap-conditioned transition matrices, companies rated A1 with a bond-implied rating of Aa2 outperformed the broad market 20% of the time over the following 12 months, matched the markets performance 26% of the t...
