Moody’s buys into Philratings

Moody’s Corp. is set to acquire a minority stake in Philippine Rating Services Corp. (PhilRatings), marking the first investment by a global credit rating agency in a domestic debt watchdog.

The investment will be made through Moody’s Ratings, one of the world’s three major credit rating agencies, although the terms of the transaction have not been disclosed.

PhilRatings will continue to operate independently, with its own management, governance and credit rating processes.

In a statement, Moody’s said the investment comes amid the potential for the Philippine domestic debt market, citing more than $100 billion in planned infrastructure investments in the country over the next three years.

“As the Philippines’ domestic bond market continues to develop, credit ratings and research will play a meaningful role in helping issuers access new sources of capital, develop funding strategies, and signal transparency to support investor confidence,” the firm said.

Wendy Cheong, Moody’s managing director and regional head for Asia Pacific, said strong domestic debt markets were essential to supporting sustainable economic growth.

“PhilRatings has built deep insight into the local market, and its ratings serve as a strong complement to Moody’s global views on credit for investors in the Philippines,” she said.

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Meanwhile, PhilRatings president Angelica Viloria said Moody’s investment would help the local agency strengthen its credit market capabilities.

“Moody’s Ratings’ global standards, best practices and technical support will help us advance our mission to strengthen the credit market infrastructure in the Philippines. Its role as a minority stakeholder reinforces our commitment to trust, credibility and best-in-class credit ratings and research for the Philippine market,” she said.

PhilRatings is a pioneering credit rating agency in the Philippines and has been operating since 1985. As of end of August, it had 41 corporations and banks on its credit rating list, covering a total of P863.5 billion in issues.