Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides international financial research on bonds issued by commercial and government entities and, with Standard & Poor's and Fitch Group, is considered one of the Big Three credit rating agencies Wikipedia.
News Article | October 31, 2015
Credit rating agency Moody’s has warned Prime Minister Narendra Modi to keep a check on the hot heads in his party or risk “losing domestic and global credibility”. This is first comment by an international agency on the recent beef and other political controversies in the country. The Modi government is already facing protests from a segment of writers, historians, artists and scientists over alleged “growing intolerance” in the country. Moody’s Analytics, the economic research and analysis division of Moody’s Corporation said that the BJP-led NDA government does not have a majority in the upper house to pass crucial reforms and has been met with an obstructionist opposition. “But in recent times, the government also hasn’t helped itself, with controversial comments from various BJP members. While Modi has largely distanced himself from the nationalist gibes, the belligerent provocation of various Indian minorities has raised ethnic tensions,” said Moody’s Analytics in a report titled India Outlook: Searching for Potential. It noted that along with a possible increase in violence, the government will face stiffer opposition in the upper house as debate turns away from economic policy. “Modi must keep his members in check or risk losing domestic and global credibility,” said Moody’s. Moody’s Analytics is different from Moody’s Investors Service Inc, the credit ratings agency which is also a subsidiary of Moody’s Corporation. Moody’s Analytics said that state election in Bihar could prove pivotal to Mr Modi’s leadership. “Overall, it’s unclear whether India can deliver the promised reforms and hit its growth potential. Undoubtedly, numerous political outcomes will dictate the extent of success,” it said. The report said that “consistent failure to deliver key economic reforms has faded the optimism. While global market sentiment has been down, Indian equities have also suffered from a loss in domestic sentiment,” said Moody’s Analytics.
News Article | October 30, 2015
Against the backdrop of controversies like on beef, Moody’s Analytics today cautioned Prime Minister Narendra Modi that the country may lose domestic and global credibility if he doesn’t rein in the members of his party. In a report titled India Outlook: Searching for Potential, Moody’s Analytics said for the country to reach its growth potential it has to deliver the promised reforms. “Undoubtedly, numerous political outcomes will dictate the extent of success,” it said. The ruling BJP does not have a majority in the Rajya Sabha and crucial reforms bills has been met with an obstructionist opposition. “But in recent times, the government also hasn’t helped itself, with controversial comments from various BJP members. While Modi has largely distanced himself from the nationalist gibes, the belligerent provocation of various Indian minorities has raised ethnic tensions. “Along with a possible increase in violence, the government will face stiffer opposition in the upper house as debate turns away from economic policy. Modi must keep his members in check or risk losing domestic and global credibility,” Moody’s said. It projected that India’s GDP growth for September quarter at 7.3 per cent, while for the full fiscal it would be 7.6 per cent. “Key economic reforms could deliver greater potential GDP, as they would improve India’s productive capacity. These include the land acquisition bill, a national goods and service tax, and revamped labour laws. They are unlikely to pass through Parliament in 2015, but there is an even chance of success in 2016,” Moody’s said. As regards interest rates, it said low rates will buttress the economy in the short-term but reforms are needed to reach long-term potential growth. The Reserve Bank kick-started the recovery by cutting the repo rate by 1.25 per cent this year. It said positive signs are emerging with the State Bank of India, the nation’s largest bank, cut its base lending rate earlier this month. “Capacity utilisation has been low across industries this year. The capital expenditure pipeline is running dry. However, interest rate cuts should encourage investment, as will the softer inflation profile,” it added. Moody’s Analytics, the research and analysis arm of Moody’s Corporation, projected the RBI to keep rates on hold for the remainder of 2015, with a small chance of another cut early next year. It, however, cautioned that Indian equities have suffered loss in global and domestic investors. “The Sensex has fallen around 11 per cent since the euphoria behind the new government propelled the stock market. But consistent failure to deliver key economic reforms has faded the optimism,” it added. As regards the impending US rate hike, it said: “The rupee will likely come out relatively unscathed thanks to the RBI’s bulging foreign exchange reserves stockpile.” The slowdown in global growth will prove a major headwind for Indian exporters, Moody’s said, adding that the fall in exports from 2015 is expected to continue in 2016. “The newfound stability in India’s current account balance could come under renewed stress if global growth slows more. So far, lower oil prices have buttressed the trade balance. But a rebound in prices if oil supply rebalances could see the trade balance deteriorate,” Moody’s said. Moody’s Analytics said there are indications that investors have been less optimistic about India’s economic prospects. Net financial flows into equity were around USD 16 billion in 2014. However, they are unlikely to reach those highs this year. The same can be said about financial flows into India’s debt market, it added. RBI is consistently looking to improve India’s banking and financial structures, Moody’s said, adding We believe a move towards full capital account liberalisation is inevitable in India. “This will likely occur in the next two to four years. A freer capital account will give Indian companies greater access to overseas markets, lower borrowing costs, and facilitate credit growth a key ingredient to increasing investment,” it added.
News Article | October 26, 2015
ZUG, Switzerland--(BUSINESS WIRE)--Allied World Assurance Company Holdings, AG (NYSE:AWH) announced today that its subsidiary, Allied World Assurance Company Holdings, Ltd, has priced an SEC registered offering of $500 million aggregate principal amount of 4.35% senior notes due 2025. The notes are fully and unconditionally guaranteed by Allied World Assurance Company Holdings, AG. The company expects to close the offering on or about October 29, 2015, subject to customary closing conditions. Allied World Assurance Company Holdings, Ltd expects to use the net proceeds from the offering for the repayment, upon maturity, of its outstanding $500 million aggregate principal amount of 7.50% senior notes due August 1, 2016. Barclays Capital Inc., Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., and Wells Fargo Securities, LLC served as joint book-running managers. BMO Capital Markets Corp. and ING Financial Markets LLC served as co-managers. The notes are being offered pursuant to an effective shelf registration statement that has been filed with the Securities and Exchange Commission (the “SEC”). This press release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. Any offer, or solicitation to buy, if at all, will be made solely by means of a prospectus and related prospectus supplement filed with the SEC. You may obtain these documents without charge from the SEC at www.sec.gov. Alternatively, you may request copies of these materials from the joint book-running managers by contacting Barclays Capital Inc. at 745 Seventh Avenue, NY, NY 10019, 1-888-603-5847 or Credit Suisse Securities (USA) LLC at Eleven Madison Avenue, NY, NY 10010, 1-800-221-1037. Allied World Assurance Company Holdings, AG, through its subsidiaries and brand known as Allied World, is a global provider of innovative property, casualty and specialty insurance and reinsurance solutions. Allied World offers superior client service through a global network of offices and branches. All of Allied World's rated insurance and reinsurance subsidiaries are rated A by A.M. Best Company, A by Standard & Poor's, and A2 by Moody's, and our Lloyd's Syndicate 2232 is rated A+ by Standard & Poor's and AA- by Fitch. Please visit the following for further information on Allied World: Web: www.awac.com | Facebook: www.facebook.com/alliedworld | LinkedIn: http://www.linkedin.com/company/Allied-World. Any forward-looking statements made in this press release reflect our current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those set forth in these statements. For example, our forward-looking statements could be affected by the satisfaction of the conditions to the closing of the senior notes offering described herein; pricing and policy term trends; increased competition; the adequacy of our loss reserves; negative rating agency actions; greater frequency or severity of unpredictable catastrophic events; the impact of acts of terrorism and acts of war; the company or its subsidiaries becoming subject to significant income taxes in the United States or elsewhere; changes in regulations or tax laws; changes in the availability, cost or quality of reinsurance or retrocessional coverage; adverse general economic conditions; and judicial, legislative, political and other governmental developments, as well as management's response to these factors, and other factors identified in our filings with the U.S. Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We are under no obligation (and expressly disclaim any such obligation) to update or revise any forward-looking statement that may be made from time to time, whether as a result of new information, future developments or otherwise.
News Article | March 10, 2015
If the game of Life taught us anything, it’s that buying a house is one of the most important decisions a person can make. Today, personal finance startup SmartAsset has significantly expanded its platform that provides people with tools they need to make intelligent home-buying decisions. Y Combinator-backed SmartAsset prompts you with a series of questions about your income, deductions, assets, geography, and expenses. Based on the responses, the engine generates personalizes advice on what is affordable and why, how a purchase would affect cash flow, tax consequences, and more. The new features include mortgage advice, government programs, neighborhood recommendations, and home appreciations. “In the wake of the financial crisis, the average consumer is less trusting of banks and brokers for financial advice and seeks greater autonomy in decision-making,” said founder Michael Carvin in an email. “SmartAsset equips users with the information and analytics they need to make decisions for themselves. SmartAsset provides unparalleled transparency into financial decision-making.” Carvel was working in finance when he decided to buy a home. He was surprised to learn how complicated the process was and about all the hidden costs. He said advice from real estate agents, brokers, and other companies was often wrong or biased, and online advice was “static or anecdotal,” meaning it did not pertain to his personal circumstances. Financing is one of those areas where one size does not always fit all, and Carvin decided to build an engine that delivered personalized and accurate advice. SmartAsset first launched in July. This update triples the number of questions its customers can answer, which adds an additional layer of customization. Carvin said that these questions are searched for on Google 4 million times per month, and he is responding to user demand to help people answer these questions in an intelligent and trusted way. Now in addition to factoring in personal information, tax codes, transaction expenses, and dynamic property values, SmartAsset will also answer questions about mortgage insurance and types, checks if users qualify for government programs, make neighborhood recommendations based on data about local crime rates, school quality, weather, and commute times. The company also partnered with Moody’s, which provides credit ratings and research, to forecast home appreciation by county. Carvin said this is the first time this data has been made public. While for now, SmartAsset is focused on home-buying, there are 24 other “life-changing” financial decisions in the pipeline, such as whether to go back to school or when to retire. The startup is based in New York and backed by $2.4 million from North Bridge Venture Partners, Javelin Venture Partners, Peterson Venture Partners, Y Combinator, Quotidian Ventures, and angels.
News Article | March 17, 2015
Oklahoma, the fifth-largest oil-producing state, froze hiring and salaries and is considering tapping reserves with crude prices down almost 60 percent since June. Revenue projections dwindled by more than $300 million from December to February, more than doubling to $611 million the budget deficit that Republican Governor Mary Fallin and lawmakers have to plug for the year starting July 1, state documents show. While Oklahoma isn’t as vulnerable as some states to tumbling oil prices, it’s increasingly reliant on energy. The industry generates about 14 percent of household earnings, the most in data going back to 1969, said Mark Snead, president of RegionTrack, which provides analysis to the state tax commission. “Oil is a big factor in Oklahoma’s budget because of the effect it has on the rest of the economy,” Shelly Paulk, deputy budget director, said in an interview. “So when you lose jobs out on an oil rig out in western Oklahoma, that’s income tax that’s not coming in. That’s sales tax that’s not coming in.” Crude slumped to a six-year low of about $42.20 a barrel Wednesday, from about $105 at the end of June, in part as U.S. shale-oil production surged. The spillover from the tumble underscores how municipalities that thrived as crude soared are now getting pinched. Mineral-rich states are considering slashing spending on education and transportation, raiding reserves and raising taxes. Alaska, which gets about 90 percent of general revenue from oil production, has proposed eliminating more than 300 government jobs. Louisiana, where proceeds from oil and gas account for 13 percent of revenue, halted travel spending for agencies. New Mexico in February cut revenue projections by $223 million for this fiscal year and next. In Oklahoma, oil-production taxes generate about 4 percent of revenue, according to Moody’s Investors Service. Oil and gas together account for 8.6 percent of personal income, most among the biggest energy-producing states, Moody’s data show. The company grades the state of about 3.9 million people Aa2, the third-highest level, with a stable outlook. Municipal debt from Oklahoma has earned 2.4 percent in the past six months, in line with the gain for the entire market for city and state debt, Barclays Plc data show. Oklahoma is also home to Cushing, the nation’s largest oil-storage hub and the delivery point for the U.S. benchmark West Texas Intermediate oil futures contract. About half the budget gap is from falling energy-tax revenue, Treasurer Ken Miller said in a March 3 interview. Gross production collections from oil and natural gas in February tallied $53.09 million, down 24 percent from a year earlier, data from the treasurer’s office show. A state board certified last month that lawmakers would have $6.6 billion to spend in the fiscal year starting July 1, about 8.5 percent less than this year. To deal with the budget shortfall, Fallin, a 60-year-old in her second term, has proposed cutting agency appropriations and redirecting money from about $535 million of rainy-day funds to government services such as education. Fallin also issued an order Feb. 6 that froze hiring, raises and bonuses for state employees, unless an exception is approved. “Fifty dollar a barrel oil prices and a $611 million budget shortfall certainly qualify as challenges, even setbacks, but they are ones that we can overcome,” Fallin said in a statement this month. An income-tax cut that takes effect Jan. 1, 2016, accounts for less than 10 percent of the shortfall, according to John Estus, a spokesman for the Office of Management and Enterprise Services. Michael McNutt, the governor’s press secretary, declined to comment on the fallout from declining oil prices. Softening the blow, consumers are paying less at the pump. Sales-tax revenue rose 5.3 percent in February from a year earlier, signaling that people used money saved on gasoline to buy other items, said Miller, the treasurer. Yet job losses from the oil slide have already begun. Chaparral Energy, the third-largest producer in Oklahoma, cut 121 positions last month at its Oklahoma City headquarters. Tulsa-based Helmerich & Payne Inc., the biggest rig operator in the U.S., said in January that it may cut at least 2,000 positions in its oil fields. The number of rigs targeting oil and gas in Oklahoma dropped to 134 as of March 13, the lowest since 2010, according to data from Baker Hughes Inc., a Houston-based field-services company. While the stress may be greater in states such as Alaska, Oklahoma is “sort of like the second shoe to drop,” said Julius Vizner, an analyst at Moody’s.