Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland)

Transcription

1 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Primary Credit Analyst: Alexandre Birry, London (44) ; Secondary Contact: Dhruv Roy, London (44) ; Table Of Contents Major Rating Factors Outlook Rationale Related Criteria And Research DECEMBER 9,

2 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) SACP a+ + Support +1 + Additional Factors 0 Anchor Business Position bbb+ Very Strong +2 GRE Support 0 Issuer Credit Rating Capital and Earnings Adequate 0 Risk Position Strong +1 Group Support 0 AA-/Negative/A-1+ Funding Liquidity Average Adequate 0 Sovereign Support +1 Major Rating Factors Strengths: Market-leading franchise in The Netherlands. Relatively cautious strategy. Strengthened funding and liquidity profiles. Weaknesses: Some deterioration in domestic performance owing to the difficult economic backdrop. Modest efficiency in light of sluggish growth prospects. Some management flux in recent months. DECEMBER 9,

3 Outlook: Negative Standard & Poor's Ratings Services' negative outlook on Rabobank Nederland reflects the possibility that we may view the bank's franchise stability and management, as well as its risk position, less favorably in the next months. This reflects our opinion of the governance failure that the investigation into the setting of interbank offered rates highlighted. It also reflects some management flux in recent months, and the higher cost of risk since mid-2011 owing to the difficult economic backdrop. We consider these factors to be particularly relevant given our current "very strong" and "strong" assessments of the bank's business and risk positions, respectively. We could lower the ratings on Rabobank Nederland if we see evidence in the next months that the bank's governance and franchise stability are not much stronger than those of other resilient banks with similar industry risk. We would then reflect this by revising our assessment of Rabobank Nederland's business position to "strong" from "very strong". We could also lower the ratings if the bank's asset quality failed to continue to outperform its peer group, or in the event of a significant further deterioration in economic conditions. We could revise the outlook back to stable if the bank demonstrated that remedial actions it has taken have materially improved its governance framework and that the recent events and strategic initiatives being implemented have not affected the hitherto exceptionally strong stability of its core franchise. We would also likely expect to see greater stability in the domestic operating environment before reverting the outlook to stable. Rationale The starting point for our ratings on Rabobank Nederland is its 'bbb+' anchor, which is primarily based on our view of the banking system in its home market of The Netherlands. We consider its business position to be "very strong" (as defined by our criteria) due to its strong franchise in The Netherlands and its relatively prudent strategy. We view capital and earnings as "adequate" based primarily on our expectation that the bank's RAC ratio before adjustments will be in the 8.25%-8.75% range in the next months. Our assessment of the bank's risk position is "strong" due to the relatively defensive profile of its balance sheet, underpinned by its large domestic residential mortgage portfolio. We view funding as "average" and liquidity as "adequate" since we consider that the relatively high loan-to-deposit ratio by international standards is mitigated by the improving maturity profile of Rabobank Nederland's wholesale funding and its sound liquidity buffers. The ratings also reflect Rabobank Nederland's "high" systemic importance in The Netherlands, which takes into account its material market share in retail deposits in particular. Anchor The 'bbb+' anchor draws on our Banking Industry Country Risk Assessment (BICRA) methodology and our view of the weighted-average economic risk in the countries in which Rabobank Nederland operates, based on the geographic distribution of its private sector customer lending--the Netherlands (75%), the rest of Europe (10%), North America (10%), and the rest of the world (5%). The economic risk score for The Netherlands is '3' on a scale of 1-10 (1 is the lowest risk and 10 is the highest), and the weighted-average score for the countries in which Rabobank Nederland operates is close to that level. Our assessment of economic risk in The Netherlands incorporates our expectation of ongoing pressure on the private sector as a result of the price correction in the Dutch property market, which we expect to end in 2014, elevated gross household leverage, the subpar growth outlook in the European Economic and Monetary Union (EMU or eurozone), and measures to reduce the budget deficit. Our industry risk score for Rabobank DECEMBER 9,

4 Nederland is based solely on its home market of The Netherlands. The Dutch banking industry is dominated by three large players, of which Rabobank Nederland is one. The other two are subject to restructurings--albeit largely completed by now--as a result of state aid that they had received. The sector's relatively large reliance on wholesale funding is partly attributable to households' propensity to save in life insurance and pension products. Table 1 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Key Figures --Year-ended Dec (Mil. ) 2013* Adjusted assets 696, , , , ,962.0 Customer loans (gross) 483, , , , ,071.0 Adjusted common equity 29, , , , ,696.6 Operating revenues 6, , , , ,867.0 Noninterest expenses 4, , , , ,304.0 Core earnings , , , ,902.0 *Data as of June 30--customer loans not adjusted for reverse repurchase agreements in this period. N.A.--Not available. N/A--Not applicable. N.M.--Not meaningful. Business position: Exceptionally stable and resilient franchise We consider Rabobank Nederland's business position to be "very strong," reflecting its exceptional stability and resilience, prudent strategy, and leading competitive position in its domestic market. Rabobank Nederland is a cooperative organization and it prioritizes steady, long-term franchise growth over short-term returns. In our view, this approach has enabled Rabobank Nederland to navigate the global financial crisis relatively comfortably. We see downside risk to our assessment of Rabobank Nederland's franchise due to: The revelation of a number of bank employees' inappropriate conduct related to interbank rate submissions, and the failure of the governance framework to identify and manage these risks. The events occurred between 2005 and early 2011, and the company reports that 30 employees were involved in, aware of, or should have been aware of the inappropriate conduct. Our assessment of some management flux in the past few months. We base our view on the resignation of the chairman of the executive board, who has been replaced by a long-standing member of the supervisory board, as well as a few other changes within the supervisory and executive boards since mid However, we note positively that the bank has taken a number of material remedial actions to improve its governance framework. In addition, we expect the management team to stick to the cooperative bank's strategy of simplification of the organization and stronger focus on its domestic franchise and the food and agri sector internationally. Stable revenue generation from the bank's domestic retail and commercial banking activities is a key supporting factor (see chart 1). This stability is underpinned by Rabobank Nederland's diversified product offering and its leading positions in Dutch household savings (39% market share at June 30, 2013), residential mortgages (31%), and lending to the trade, industry, and service sectors (44%). The bank's roots are in financing the Dutch agricultural sector, and it still dominates this market; its market share exceeds 80%. DECEMBER 9,

5 Chart 1 Rabobank Nederland is less diversified internationally than several larger banks, but it is active outside The Netherlands in supporting Dutch clients and in its traditional core market of food and agriculture financing. Its international network is consequently focused on major agricultural centers in Europe, the Americas, and Australasia. It also conducts wholesale, commercial, and retail banking in selected countries. Wholesale banking activities are carried out under the trading name Rabobank International, which is a division of Rabobank Nederland, rather than a separate legal entity. We consider that recent transactions--such as the absorption of a smaller Dutch bank, Friesland Bank, the sale of its stake in Switzerland's Bank Sarasin, and the sale of global asset manager Robeco (completed in July 2013) and its Polish subsidiary Bank BGZ (announced in early December 2013)--are aligned with the group's strategic priorities and have had a broadly neutral impact on our view of the strength of Rabobank Nederland's core franchise. Table 2 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Business Position --Year-ended Dec (%) 2013* Total revenues from business line (currency in millions) 6,445 13,452 13,378 12,716 11,867 DECEMBER 9,

6 Table 2 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Business Position (cont.) Retail banking/total revenues from business line Commercial & retail banking/total revenues from business line Asset management/total revenues from business line Other revenues/total revenues from business line Return on equity *Data as of June 30. Domestic retail banking. Wholesale banking and international retail banking. Capital and earnings: Steady capital strengthening expected We view Rabobank Nederland's capital and earnings as "adequate." The RAC ratio before diversification adjustments stood at 7.4% at end-2012 and we expect it to increase gradually to an 8.25%-8.75% range over the next months. Rabobank Nederland's mutuality restricts to some extent its ability to raise new core capital, if required. However, it has issued deeply subordinated member certificates--classified as Core Tier 1 capital--to its customers and has demonstrated good access to the hybrid market. In our view, the recent decision to allow institutional investors to buy member certificates will increase the liquidity of these capital instruments. Rabobank Nederland's earnings capacity to date has been somewhat constrained, in our view, by the cost structure of its domestic activities, and--due to its cooperative roots--its lesser focus on profit maximization than commercial peers. However, as a result of the absence of common shareholder dividends, retained earnings have consistently been sufficient to both support balance sheet growth and increase its core capital ratios. Last year, the bank initiated a range of meaningful cost containment initiatives. These measures aim to bolster its internal capital generation capacity despite a difficult domestic backdrop and only slow recovery prospects. We expect to see tangible benefits from These measures will be key in helping the bank reach its financial targets of a return on Tier 1 capital of 8%, and a minimum core Tier 1 capital ratio of 14%. We expect that the 2013 full-year performance will be distorted by a range of one-off items, including a 1.5 billion net profit on the sale of asset manager Robeco (completed in July 2013) and the total settlement following the interbank rate setting investigation of about 770 million, which we understand was largely provisioned for in the first half of the year. While we see potential for systemwide private sector litigation relating to interbank interest rates in the medium term, we believe that the probability and potential magnitude of this risk is difficult to quantify as this stage. We estimate that the bank's RAC ratio at end-june 2013, pro forma the disposal of Robeco, stood at about 7.7%, with the net gain on the sale partly offset by the buy-back of some member certificates and a pension adjustment in the first half of Despite our expectation of an only slow improvement in domestic economic conditions from 2014, we expect the ratio to increase by about 50 to 70 basis points (bps) over the next months. This is due to recently implemented cost initiatives, along with close management of the balance sheet and refocusing of international activities around the food and agriculture sectors, including the announced sale of Polish subsidiary Bank BGZ (total assets of about 8.5 billion at end-september DECEMBER 9,

7 Table 3 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Capital And Earnings --Year-ended Dec (%) 2013* Tier 1 capital ratio S&P RAC ratio before diversification N.M S&P RAC ratio after diversification N.M Adjusted common equity/total adjusted capital Net interest income/operating revenues Fee income/operating revenues Market-sensitive income/operating revenues N/A (0.7) Noninterest expenses/operating revenues Preprovision operating income/average assets Core earnings/average managed assets *Data as of June 30. N.A.--Not available. N/A--Not applicable. N.M.--Not meaningful. Table 4 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Risk Position --Year-ended Dec (%) 2013* Growth in customer loans Total diversification adjustment / S&P RWA before diversification N.M. (12.4) (17.8) (17.6) (17.6) Total managed assets/adjusted common equity (x) New loan loss provisions/average customer loans Net charge-offs/average customer loans N.M Gross nonperforming assets/customer loans + other real estate owned Loan loss reserves/gross nonperforming assets *Data as of June 30. N.A.--Not available. N/A--Not applicable. N.M.--Not meaningful. Risk position: Expected to continue outperforming peers Rabobank Nederland's risk position is "strong," in our opinion. In particular, we consider that the standard capital charges applied to its assets in the RAC framework are generally conservative in view of the better-than-average risk profile of its balance sheet. Its long-term average bad debt cost of 28bps illustrates its focus on lower-risk, more-stable sectors, although the cost has increased recently because of the weaker economy. Although its domestic market accounts for close to three-quarters of total lending, Rabobank is active across all parts of the Dutch economy, without undue concentrations. This is reflected in a diversification benefit of 12% at end-2012 under our RAC methodology. International operations are being refocused on the food and agriculture sectors in which Rabobank has longstanding expertise and competitive advantages. We observe that asset quality in certain domestic portfolios, such as commercial real estate and certain SME sectors, DECEMBER 9,

8 has deteriorated since the second half of 2011; this is in line with other Dutch players. We consider that Rabobank Nederland can manage the deterioration to date, supported by the adequate diversification of its overall exposures. Also, we observe that loan losses remain smaller than normalized losses derived from our RAC framework, and generally lower than peers. For instance, we estimate that the loan impairment charge for residential mortgages--which constitute close to half of total lending--was between one third and one half of the market average at about 6bps of average loans in 2012 and first half Our base-case view is that Rabobank Nederland's impairments in the next 18 months should remain elevated relative to their historical average. We expect the reduction in the charge in Ireland to be offset by the increased provisioning levels in The Netherlands, on the back of a weak economic outlook in the near term. As a result, we anticipate loan loss charges as a proportion of average customer loans to remain well above the bank's long-term average at about 40bps in Table 5 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) RACF [Risk-Adjusted Capital Framework] Data (Mil. ) Exposure* Basel II RWA Average Basel II RW (%) Standard & Poor's RWA Average Standard & Poor's RW (%) Credit risk Government and central banks 117,291 1, ,994 3 Institutions 25,654 5, , Corporate 250,478 91, , Retail 256,517 39, , Of which mortgage 191,034 18, , Securitization 23,082 8, , Other assets 19,131 34, , Total credit risk 692, , , Market risk Equity in the banking book 5,050 14, ,682 1,043 Trading book market risk -- 5, , Total market risk -- 20, , Insurance risk Total insurance risk Operational risk Total operational risk -- 20, , (Mil. ) Basel II RWA Standard & Poor's RWA % of Standard & Poor's RWA Diversification adjustments RWA before diversification 223, , Total adjustments to RWA -- (55,450) (12) RWA after diversification 223, , DECEMBER 9,

9 Table 5 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) RACF [Risk-Adjusted Capital Framework] Data (cont.) (Mil. ) Tier 1 capital Tier 1 ratio (%) Total adjusted capital Standard & Poor's RAC ratio (%) Capital ratio Capital ratio before adjustments Capital ratio after adjustments 38, , , , *Exposure at default. Securitisation Exposure includes the securitisation tranches deducted from capital in the regulatory framework. Exposure and Standard & Poor's risk-weighted assets for equity in the banking book include minority equity holdings in financial institutions. Adjustments to Tier 1 ratio are additional regulatory requirements (e.g. transitional floor or Pillar 2 add-ons). RWA--Risk-weighted assets. RW--Risk weight. RAC--Risk-adjusted capital. Sources: Company data as of Dec. 31, 2012, Standard & Poor's. Rabobank Nederland has not been immune to the difficult economic and market conditions in The Netherlands, however, and has incurred elevated impairments and write-downs in certain international markets in recent times, particularly in Ireland and earlier in U.S. structured credit. These losses were recognized at a relatively early stage, and the group was able to manage them due to the small size of the underlying portfolios in the context of the consolidated balance sheet. Funding and liquidity: Strong deposit franchise and well-managed wholesale funding base Rabobank Nederland's funding is "average" and liquidity position is "adequate," in our opinion. As is the norm in the Dutch market, its loan-to-deposit ratio is relatively high, at about 140% at June 30, 2013, despite its leadership position in the domestic deposit market. Strong inflows of deposits, despite continued lending growth, have led to some improvement in the ratio since end-2010, when the ratio stood at 151%. Management aims for a ratio of 130% by Management considers that it met the Basel III liquidity and funding requirements at end-june 2013 with a liquidity coverage ratio of 131% and a net stable funding ratio estimated at 102%. The bank has maintained good access to both public and private wholesale funding markets through the crisis and has taken advantage of opportunities to extend the maturity profile of debt issues. The average maturity of debt issued in recent years exceeds five years. In November 2013, the bank issued $3 billion of Tier 2 subordinated debt in two tranches with maturities of 10 and 30 years. We observe decreasing reliance on short-term wholesale funding, which underpins the improvement in our stable funding ratio to 97.5% at end-2012 from 92.0% at end Rabobank Nederland's liquidity position has strengthened materially over the past few years. The bank maintains a surplus of liquid assets well in excess of regulatory requirements. At end-june 2013, it reported a liquidity buffer of 131 billion, 34% of which is in cash, mainly placed at the ECB, and 35% in government debt. The remainder consisted of other assets eligible for repo activity with central banks. By our measure, we calculate that the bank's coverage of short-term wholesale funding by its broad liquid assets improved materially to 1.1x at end-2012 from 0.8x at end Table 6 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Funding And Liquidity --Year-ended Dec (%) 2013* Core deposits/funding base DECEMBER 9,

10 Table 6 Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Funding And Liquidity (cont.) Customer loans (net)/customer deposits Long term funding ratio N/A Stable funding ratio N/A N/A Short-term wholesale funding/funding base N/A Broad liquid assets/short-term wholesale funding (x) Net broad liquid assets/short-term customer deposits Short-term wholesale funding/total wholesale funding *Data as of June 30. N.A.--Not available. N/A--Not applicable. N.M.--Not meaningful. External support: High systemic importance in The Netherlands N/A N/A N/A (7.8) N/A N/A The long-term counterparty credit rating on Rabobank Nederland is one notch higher than the stand-alone credit profile, reflecting our view that it has high systemic importance in The Netherlands and that the government is supportive toward its banking sector. Our assessment of Rabobank Nederland's systemic importance partly reflects its material market shares in retail deposits and residential mortgages. Related Criteria And Research Long-Term Ratings On The Netherlands Lowered To 'AA+' On Weak Growth Prospects; Outlook Stable, Nov. 29, 2013 Three Dutch Financial Service Groups Ratings Lowered Following Similar Action On The Netherlands, Dec. 2, 2013 Banking Industry Country Risk Assessment: The Netherlands, Nov. 8, 2013 Various Rating Actions Taken On Dutch Banks Due To Increased Economic Risks, Nov. 16, 2012 No Pain, No Gain: How The Housing Market Correction Is Affecting Dutch Banks, June 27, 2012 Banks: Rating Methodology And Assumptions, Nov. 9, 2011 Group Rating Methodology And Assumptions, Nov. 9, 2011 Banking Industry Country Risk Assessment Methodology And Assumptions, Nov. 9, 2011 Bank Hybrid Capital Methodology And Assumptions, Nov. 1, DECEMBER 9,

11 Anchor Matrix Industry Risk Economic Risk a a a- bbb+ bbb+ bbb a a- a- bbb+ bbb bbb bbb a- a- bbb+ bbb+ bbb bbb- bbb- bb bbb+ bbb+ bbb+ bbb bbb bbb- bb+ bb bb - 5 bbb+ bbb bbb bbb bbb- bbb- bb+ bb bb- b+ 6 bbb bbb bbb- bbb- bbb- bb+ bb bb bb- b+ 7 - bbb- bbb- bb+ bb+ bb bb bb- b+ b bb+ bb bb bb bb- bb- b+ b bb bb- bb- b+ b+ b+ b b+ b+ b+ b b b- Ratings Detail (As Of December 9, 2013) Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland) Counterparty Credit Rating Certificate Of Deposit Greater China Regional Scale Greater China Regional Scale Commercial Paper Foreign Currency Local Currency Junior Subordinated A- Preferred Stock A- Greater China Regional Scale Short-Term Debt Subordinated Counterparty Credit Ratings History 04-Nov Nov Jan Dec Nov Dec-2009 Sovereign Rating Netherlands (The) (State of) (Unsolicited Ratings) AA-/Negative/A-1+ AA-/A-1+ cnaaa/cna-1+ cna-1+ A-1+ AA-/A-1+ cnaaa A-1+ AA- AA-/A-1+ A-1+ A AA-/Negative/A-1+ AA-/Stable/A-1+ AA/Negative/A-1+ AA/Watch Neg/A-1+ AA/Stable/A-1+ AAA/Negative/A-1+ AA+/Stable/A-1+ DECEMBER 9,

12 Ratings Detail (As Of December 9, 2013) (cont.) Related Entities Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland), (London Branch) Issuer Credit Rating Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., "Rabobank Nederland" (New York Branch) Issuer Credit Rating Short-Term Debt Subordinated Rabobank Nederland (Australia Branch) Rabobank Nederland (Hong Kong branch) (Unsolicited Ratings) Certificate Of Deposit Greater China Regional Scale Rabobank New Zealand Ltd. Issuer Credit Rating Rabobank USA Financial Corp. Issuer Credit Rating Rabo Capital Securities Ltd. Junior Subordinated A- Rabohypotheekbank N.V. Issuer Credit Rating AA-/Negative/A-1+ AA-/Negative/A-1+ A-1+ A A-1+ AA- AA- cnaaa/cna-1+ AA-/Negative/A-1+ --/--/A-1+ AA-/Negative/-- *Unless otherwise noted, all ratings in this report are global scale ratings. Standard & Poor's credit ratings on the global scale are comparable across countries. Standard & Poor's credit ratings on a national scale are relative to obligors or obligations within that specific country. Additional Contact: Financial Institutions Ratings Europe; FIG_Europe@standardandpoors.com DECEMBER 9,

13 Copyright 2013 by Standard & Poor's Financial Services LLC. All rights reserved. No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P). The Content shall not be used for any unlawful or unauthorized purposes. S&P and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively S&P Parties) do not guarantee the accuracy, completeness, timeliness or availability of the Content. S&P Parties are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, for the results obtained from the use of the Content, or for the security or maintenance of any data input by the user. The Content is provided on an "as is" basis. S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE CONTENT'S FUNCTIONING WILL BE UNINTERRUPTED, OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION. In no event shall S&P Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Content even if advised of the possibility of such damages. Credit-related and other analyses, including ratings, and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact. S&P's opinions, analyses, and rating acknowledgment decisions (described below) are not recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security. S&P assumes no obligation to update the Content following publication in any form or format. The Content should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. S&P does not act as a fiduciary or an investment advisor except where registered as such. While S&P has obtained information from sources it believes to be reliable, S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives. To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes, S&P reserves the right to assign, withdraw, or suspend such acknowledgement at any time and in its sole discretion. S&P Parties disclaim any duty whatsoever arising out of the assignment, withdrawal, or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof. S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of S&P may have information that is not available to other S&P business units. S&P has established policies and procedures to maintain the confidentiality of certain nonpublic information received in connection with each analytical process. S&P may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P reserves the right to disseminate its opinions and analyses. S&P's public ratings and analyses are made available on its Web sites, (free of charge), and and (subscription) and (subscription) and may be distributed through other means, including via S&P publications and third-party redistributors. Additional information about our ratings fees is available at DECEMBER 9,