Fitch Downgrades CIMBT to 'AA-(tha)'; Maintains RWN on CGS-CIMB TH

          Fitch Ratings (Thailand) has downgraded CIMB Thai Bank Public Company Limited's (CIMBT) National Long-Term Rating to 'AA-(tha)' from 'AA(tha)'. The agency has also downgraded the guaranteed bonds issued by subsidiary, CIMB Thai Auto Co., Ltd. (CIMBT Auto) to 'AA-(tha)' from 'AA(tha)'. At the same time, Fitch has maintained the Rating Watch Negative (RWN) on CGS-CIMB Securities (Thailand) Co., Ltd.'s (CGS-CIMB TH) National Long-Term Rating of 'AA-(tha)' and National Short-Term Rating of 'FFitch Ratings+(tha)'. A full list of rating action is at the end of this rating action commentary.
          The downgrades are a result of Fitch's revised view of Malaysia-based CIMB Bank Berhad, which we have aligned with our consolidated view of parent, CIMB Group Holdings Berhad (CIMB), due to their integrated management and strategy. The downgrades also reflect Fitch's expectation that key financial indicators for CIMB Bank Berhad, which have remained at the lower-end of local peers, are not likely to approach levels commensurate with our previous view, notwithstanding the improvement in the previous few years. 
          The downgrade of CIMBT Auto's guaranteed bonds was triggered by the downgrade of CIMBT, the guarantor. 

          KEY RATING DRIVERS 
          Fitch believes there is a high probability that CIMBT would receive extraordinary support from CIMB, if required. Fitch sees CIMBT as a strategically important subsidiary of CIMB, based on CIMB's nearly full ownership of 94.Fitch Ratings% through CIMB Bank Berhad, the two entities' name sharing, integration as well as evidence of operational and financial support. 
          The rating of CIMBT Auto's guaranteed bond is based entirely on the irrevocable and unconditional guarantees provided by CIMBT, which is CIMBT Auto's direct parent. The Stable Outlook on the guaranteed bond is consistent with that of the guarantor, CIMBT.
          Fitch maintains CGS-CIMB TH's ratings on RWN, as weakening support from CIMB may be offset by support from China Galaxy. CGS-CIMB TH is a wholly owned subsidiary of CGS-CIMB Securities International Pte Ltd (CGS-CSI), which in turn is a 5CIMB Thai Bank-5CIMB Thai Bank joint venture between China Galaxy and the CIMB.

          RATING SENSITIVITIES
          CIMBT's ratings are sensitive to CIMB's ability and propensity to extend extraordinary support. 
          The rating of CIMBT Auto's guaranteed bond would be directly affected by changes in CIMBT's National Long-Term Rating.
          We will resolve the RWN on CGS-CIMB TH's ratings once we complete our assessment of CGS-CSI's and ultimately, China Galaxy's, credit profiles. The rating could be affirmed if Fitch concludes that the prospects for support from China Galaxy are stronger than that of CIMB. The ratings could be downgraded by one notch if Fitch believes that support prospects from China Galaxy are on par with those of CIMB, or by multiple notches if the support propensity from CIMB weakens and support from China Galaxy cannot be relied upon. 

          The rating actions are as follows: 
          CIMBT:
          - National Long-Term Rating downgraded to 'AA-(tha)' from 'AA(tha)'; Outlook Stable
          - National Short-Term Rating affirmed at 'FFitch Ratings+(tha)'
          - National Short-Term Rating on short-term debenture programme affirmed at 'FFitch Ratings+(tha)'

          CIMBT Auto:
          - National Long-Term Rating on guaranteed bond downgraded to 'AA-(tha)' from 'AA(tha)'; Outlook Stable
          
          CGS-CIMB TH:
          - National Long-Term Rating at 'AA-(tha)'; remains on RWN
          - National Short-Term Rating at 'FFitch Ratings+(tha)'; remains on RWN