The following is a press release from Fitch Ratings: 
 

Fitch Ratings-Singapore-15 October 2009: Fitch Ratings has today affirmed Oversea-Chinese Banking Corp's (OCBC) Long-term foreign currency Issuer Default Rating (IDR) at 'AA-' with a Stable Outlook, following the announcement of its acquisition of ING Asia Private Bank ("ING APB"). The full list of rating actions is included at the end of this release.

The cash consideration for ING APB is USD1.5bn, which is 1.6 times its net asset value. OCBC estimates that its capital ratios would reduce by around 1.5% due to USD550m in goodwill and additional risk-weighted assets arising from the acquisition. On balance, in view of the bank's high capital buffer, its reduced core Tier 1 capital adequacy ratio (CAR) of a pro-forma 10.0% at end-H109 remains strong and comparable with its peers.

Most importantly, Fitch still believes that OCBC has a solid loss absorption capacity to negotiate the difficult economic environment, which underpins the affirmation of the bank's ratings. Asset quality deterioration should only be an earnings issue for the bank, with impairment charges accounting for about 20% of pre-impairment profits in H109, and capital impairment risks continue to be low. This means that OCBC's capital position is likely to stay strong, a key reason behind the maintenance of the Stable Outlook on its high ratings, despite challenging macroeconomic conditions.

OCBC is a Singapore-based listed banking group, which has been expanding within Asia over the past few years, although Singapore and Malaysia continue to account for the bulk of total assets, at 87% as of end-H109.

The full list of rating actions on OCBC is as follows: - Long-term foreign currency IDR affirmed at 'AA-' with a Stable Outlook;- Short-term foreign currency IDR affirmed at 'F1+';- Individual rating affirmed at 'B';- Support rating affirmed at '1'; - Support Rating Floor affirmed at 'A-'; - Rating on commercial paper programme affirmed at 'F1+'; and- Ratings on Tier-2 and Hybrid Tier-1 programmes affirmed at 'A+'.

Contacts: Alfred Chan, Singapore, +65 6796 7220; Tan Lai Peng, Singapore, +65 6796 7219; Ambreesh Srivastava, Singapore, +65 6796 7218.

Media Relations: Shivani Sundralingam, Singapore, Tel: + 65 6796 7215, Email: shivani.sundralingam@fitchratings.com.