zuercher kantonalbank g… · in domestic investment banking operations in switzerland, as...

FINANCIAL INSTITUTIONS

ASSESSMENT13 April 2018

TABLE OF CONTENTSSummary analysis 1Summary opinion 1Profile 2Transaction summary 2Strengths and weaknesses 2Organization 2Use of proceeds 3Disclosure on the use of proceeds 6Management of proceeds 6Ongoing reporting and disclosure 7Moody's Green Bond Assessment(GBA) 9Moody’s related publications 9

Analyst Contacts

Matthew Kuchtyak [email protected]

Andrea Wehmeier +49.69.70730.782VP-Senior [email protected]

Rahul Ghosh +44.20.7772.1059SVP - [email protected]

SwamiVenkataraman, CFA

+1.212.553.7950

Senior Vice [email protected]

Jim Hempstead [email protected]

Zuercher KantonalbankGreen Bond Assessment

Summary analysis

GB1

Excellent

GB5

Poor

GB4

Fair

GB2

Very Good

GB3

Good

GB1

Excellent

GB5

Poor

GB4

Fair

GB2

Very Good

GB3

Good

Summary opinionA GB1 (Excellent) Green Bond Assessment (GBA) on Zuercher Kantonalbank's (ZKB, Aaastable) initial green bond offering primarily reflects the following considerations:

» Full allocation of green bond proceeds to green mortgages that qualify under an eligibleenergy efficiency standard, aligning the use of green bond proceeds with the Green BondPrinciples

» Long track record of operating the environmental loan program under which the greenmortgages qualify, with the program dating back to 1992

» Granular detail provided on the various mortgages included in the pool of green assets,including an impact analysis highlighting the expected environmental benefits

» Full refinancing of existing green mortgages providing clarity on management ofproceeds; clearly identified practices for investment of unallocated proceeds in theunlikely event that green bond volumes exceed outstanding green mortgages

» Post-issuance disclosures on use of green bond proceeds as well as impact reportinganticipated annually over the life of the bonds; impact analysis somewhat limited byinability to calculate actual energy efficiency being achieved

Factor Factor Weights Score Weighted Score

Organization 15% 1 0.15

Use of Proceeds 40% 1 0.40

Disclosure on the Use of Proceeds 10% 1 0.10

Management of Proceeds 15% 1 0.15

Ongoing Reporting and Disclosure 20% 3 0.60

Weighted Score 1.40

The transaction’s weighted score, based on our GBA methodology scorecard, is 1.40. This, inturn, corresponds to a composite grade of GB1.

https://www.moodys.com/credit-ratings/Zuercher-Kantonalbank-credit-rating-836400

MOODY'S INVESTORS SERVICE FINANCIAL INSTITUTIONS

ProfileEstablished in 1870 by the Canton of Zurich, ZKB is Switzerland's fourth-largest bank and the country's largest cantonal bank, measuredby its total assets of CHF164 billion as of year-end 2017.

The bank has a traditional retail and commercial banking franchise, and a very strong position in the Canton of Zurich, with shares ofaround 8% of the domestic mortgage loan market and around 7% of deposits as of year-end 2016. ZKB benefits from strong marketpositions in commercial and investment banking services for medium-sized and large corporate clients. The bank is one of the leadersin domestic investment banking operations in Switzerland, as illustrated by its position as the number one originator of Swiss franc-denominated domestic bond issuances and as the third-largest counterparty in listed equity derivatives (structured investment andleveraged products).

Transaction summaryZKB is issuing its initial green bond under its existing bond program, the “Issuance Programme 2017/2018.” The green bond willconstitute a senior unsecured obligation and rank pari passu with other senior unsecured bonds issued under the program. In additionto the program-wide prospectus, ZKB is publishing a prospectus addendum specifically related to the green bond, which includesdetails on the use of green bond proceeds. The issuance benefits from the state guarantee of the bank's owner, the Canton of Zurich.The green bonds will be listed on the SIX Swiss Exchange AG.

At this time, management expects the issuance will likely be in the range of CHF250-400 million, with the final maturity to bedetermined. The bonds will launch and price the week April 16 and close the week of May 7.

Strengths and weaknessesStrengths Weaknesses

Green bond organization supported by the application of the green bond proceeds

fully to an environmental loan program that aligns with the sustainability initiatives

of the bank and has been in existence since 1992

Post-issuance impact reporting limited by the inability to calculate actual energy

efficiency performance of the green loans in the identified pool

Proceeds fully going to energy efficient properties consistent with the taxonomy of

the Green Bond PrinciplesVery good disclosure on use of proceeds including granular details about the pool

of green mortgages and the expected environmental benefits of the aggregate

poolFull refinancing of existing qualified green mortgages makes proceeds

management clearAnnual post-issuance reporting expected to continue over the life of the bond and

include updates on the amount of green bonds outstanding and the size of the

loan pool

Organization

1

Excellent

5

Poor

4

Fair

2

Very Good

3

Good

Project selection for ZKB's green bond centers around the “ZKB Umweltdarlehen” environmental loan program, whose qualifying greenmortgages serve as the exclusive use of proceeds for the green bond. As outlined in the bank's standalone green bond framework, thepurpose of the green bond issuance is to refinance existing and future ZKB environmental loans.

The ZKB Umweltdarlehen environmental loan program was launched in 1992. An important contribution was made by the connectionof the Minergie (see detailed description below) certificate as an award criterion for a ZKB environmental loan in 1997. The establishedlength of the ZKB Umweltdarlehen program, as well as the stringent criteria for qualification, enable clear articulation of theenvironmental benefits of the assets being refinanced with ZKB green bonds.

This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page onwww.moodys.com for the most updated credit rating action information and rating history.

2 13 April 2018 Zuercher Kantonalbank: Green Bond Assessment


The ZKB Umweltdarlehen is part of the performance mandate of ZKB. The financial allocation criteria are determined by the productmanagement financing team. The planning, implementation, monitoring and reporting of the performance mandate and the topicsrelated to sustainability (including ZKB Umweltdarlehen as part of the sustainable products and services) is carried out by the serviceorder office. The performance commitment steering committee, the highest level decision-making body at ZKB, meets at regularintervals to advise and support the bank council and the bank presidency in all matters relating to the performance mandate, includingthe ZKB Umweltdarlehen. The performance mandate steering committee is composed of representatives of all business units and ismanaged by the specialist contractor.

As a whole, ZKB's sustainability focus is well established. In 1995, ZKB signed the United National Environment Program's (UNEP)Statement of Commitment by Financial Institutions on Sustainable Development, which aims to integrate sustainability aspects atall levels of the company. ZKB is also a member of “öbu”, a group of more than 350 Swiss companies with the goal of developingthe Swiss economy in accordance with the principles of sustainability. ZKB publishes an annual sustainability report as well as variouspolicies and targets, more information about which can be located on the bank's sustainability webpage.

Factor 1: Organization (15%) Yes No

Environmental governance and organization structure appear to be effective ƔPolicies and procedures enable rigorous review and decision making process ƔQualified and experienced personnel and/or reliance on qualified third parties ƔExplicit and comprehensive criteria for investment selection, including measurable impact results ƔExternal evaluations for decision making in line with project characteristics ƔFactor Score 1

Use of proceeds

Funds raised through the green bond will be used exclusively to refinance energy-efficient real estate under the ZKB Umweltdarlehenenvironmental loan program. Properties to be refinanced include private and commercial real estate as well as housing cooperatives.To meet the criteria for the ZKB Umweltdarlehen program, the assets must qualify under one of a variety of energy efficiency standardsfor either new construction or refurbishment. Given the nature of the standards, the green bond proceeds will be applied to assets thatqualify under the energy efficiency category of the Green Bond Principles.

The requirements to receive financing under the ZKB Umweltdarlehen program include mortgages achieving a certification on one of anumber of energy efficiency standards. For new constructions, one of the following criteria must be achieved:

» Minergie certificate

» 2000 Watt Areal certificate

» GEAK new construction certificate with a minimum performance of “A” (total energy efficiency)

For refurbishments, one of the following criteria must be achieved:

» Minergie certificate after renovation

» GEAK Plus after renovation with a minimum performance of “C” (total energy efficiency) with improvement by at least oneefficiency class

» Individual measure such as thermal insulation or climate-friendly heating systems, solar power, photovoltaic systems, heat recovery,etc.


https://www.zkb.ch/en/lg/ew/about-us/sustainability.html


Minergie is a voluntary building standard that enables the efficient use of energy and the widespread use of renewable energies. TheSwiss standard has been in place since 1998. The focus is on the living and working comfort for the building users, both in new buildingsas well as refurbishments. Minergie certifies buildings in three different standards: Minergie, Minergie-P and Minergie-A, which containdifferent requirements for the energy efficiency standards of the buildings. For more detailed information on the various Minergiestandards, see the full product regulations.

The GEAK standard is the official building energy certificate of the cantons. The standard shows how energy efficient the buildingenvelope is and how much energy a building requires in standard use. This applies to existing buildings as well as to new constructionprojects. The calculated energy demand is displayed in classes “A” to “G,” with “A” being the most energy efficient. The GEAK standardprovides information about the actual energy efficiency condition of a property as well as the energy efficiency improvement potentialof the building envelope and building technology. The standard is uniform throughout Switzerland and reflects the energy consumptionof residential buildings (single-family and apartment buildings), administration buildings and school buildings. For more information,see the full GEAK document.

The certificate 2000-Watt-Areal highlights areas that show a sustainable use of resources and climate protection for the construction,renewal and operation of buildings, as well as location-dependent mobility. The 2000-Watt site certificate is based on the Energy Citymunicipal label in combination with the SIA Energy-by-Building energy efficiency path. The certificate is awarded by the sponsoringassociation Energiestadt. It is issued only for a limited time and must be renewed periodically. The 2000-Watt-Areal standard isnew for the ZKB Umweltdarlehen loan program and qualifying buildings have not yet been included in the identified pool. For moreinformation, including details of the target energy efficiency path for qualifying buildings, see here on the standard website.

ZKB has identified 3,131 qualifying green mortgages to form the pool of eligible green assets for refinancing under the green bondprogram. These 3,131 qualifying loans total CHF1.162 billion, well in excess of the anticipated CHF250-400 million of initial greenbonds. The bank has disclosed the breakdown of these green loans by legal ownership and building type (see Exhibit 1) as well asby energy standard (see Exhibit 2). Over time the composition of the pool of assets may change, and ZKB will include the updatedinformation in its annual green bond reporting.

Exhibit 1

Pool of identified green loans by legal ownership and building typeCHF millions

Single-family home Apartment house Individual apartment Commercial use Total

Corporation 1 118 5 34 158

Small business 2 53 12 4 71

Cooperative 141 21 161

Private individual 102 192 408 12 713

Other legal entity 44 1 15 59

Total 104 548 425 85 1,162

Source: Zuercher Kantonalbank

Per ZKB's breakdown of eligible green loans by energy standard, approximately 90% of the loans are certified by one of the threeMinergie standards, Minergie, Minergie-A or Minergie-P. The remaining loans are either certified by the GEAK standard or meet anenergy renovation, renewable energy or other environmental project standard and certified by a third party.


https://www.minergie.ch/media/171215_produktreglement_minergie_p_a_v2017.3_de.pdf

https://www.geak.ch/Pages/GEAK/System/DocumentPage.aspx

http://www.2000watt.ch/fuer-gebaeude/2000-watt-gebaeude/


Exhibit 2

Pool of identified green loans by energy standardCHF millions

Single-family home Apartment house Individual apartment Commercial use Total

Corporation 1 118 5 34 158

Energy renovation 0 3 1 5

Renewable energy project 2 2

GEAK 3 1 3

Minergie 73 4 22 99

Minergie-A 0 0

Minergie-P 0 39 0 9 49

Other environmental project 0 0

Small business 2 53 12 4 71

Energy renovation 1 3 0 1 4


GEAK 0 15 15

Minergie 1 33 11 3 48

Minergie-A 0 0

Minergie-P 1 1 1

Other environmental project 0 0

Cooperative 141 21 161

Energy renovation 1 0 1


Minergie 101 9 109

Minergie-A 15 15

Minergie-P 22 12 34

Private individual 102 192 408 12 713

Energy renovation 23 7 3 2 35

Renewable energy project 3 1 2 2 8

GEAK 6 10 6 1 22

Minergie 58 137 361 6 562

Minergie-A 3 2 6 10

Minergie-P 8 24 30 62

Other environmental project 1 11 0 1 13

Other legal entity 44 1 15 59

Energy renovation 1 1


Minergie 41 1 10 51

Minergie-A 2 2

Minergie-P 1 4 5

Total 104 548 425 85 1,162

Source: Zuercher Kantonalbank

Factor 2: Use of Proceeds Yes No

>95% - 100% of proceeds allocated to eligible project categories that are determined based on the issuer’s adopted policies and the categories established under the Green Bond Principles that will be further informed by one or more robust and widely recognized

green bond frameworks or taxonomies that qualify eligible projects, including any applicable regulatory guidelines.ズ

Factor Score 1



Disclosure on the use of proceeds

ZKB has provided strong disclosure on the anticipated use of green bond proceeds, with breakdowns of the CHF1.162 billion ofenvironmental loans provided by legal ownership, building type and energy standard (see above). The granular detail linking the use ofproceeds to the various energy standards allows for an aggregate view of the benefits of the pool of green assets. While there will beno breakdown of the mortgages linked to each individual green bond issuance, the fact that all identified mortgages qualify under theenvironmental loan program allows for clarity that all assets are green.

In addition to disclosure on the use of proceeds, ZKB will publish the following documents on its website

» Green bond framework

» Green bond annual report, including impact reporting

» Moody's GBA

» Second party opinion on the green bond framework from oekom research

To calculate the quantifiable environmental benefits of the pool of green mortgages, ZKB has worked with Minergie to devise an impactreport for the portfolio of loans covered by the Minergie standard. Though this impact report only covers loans qualifying under theMinergie standard, these loans currently represent approximately 90% of the loans in the green pool.

The impact reporting aims to calculate the overall energy efficiency over the life of the measures considered, and seeks to understandhow much less energy a Minergie building is consuming compared to a conventional building. The energy efficiency benefit calculationscombine energy savings through a better building envelope and the transition from fossil energy to renewable energy. The calculationsare done separately for single-family homes, multi-family houses and functional buildings, as well as separately for the various Minergiestandards (Minergie, Minergie-P, Minergie-A).

The environmental impact analysis calculated aggregate lifetime benefits for mortgages totaling CHF1.048 billion. According to theanalysis, the full pool of Minergie buildings will result in savings of 188 GWh of energy and 32,814 tonnes of CO2 over the life of theassets. The impact report likens this to the equivalent of 90,000 barrels of oil or 1,500 tanker trucks, each with 12,000 liters capacity.

Factor 3: Disclosure on the Use of Proceeds Yes No

Description of green projects, including portfolio level descriptions, actual or intended ƔAdequacy of funding and/or strategies to complete projects ƔQuantitative and/or qualitative descriptions for targeted environmental results ƔMethods and criteria, both quantitative and qualitative, for calculating performance against targeted environmental results ƔIssuer relies on external assurances: Second Party reviews, audits and/or third party certfications ƔFactor Score 1

Management of proceeds



Given that proceeds from the green bond issuance will be used exclusively to refinance mortgages that have already qualified for aspecific energy standard, there is little risk that green bond proceeds will not be directed to green assets as intended. Furthermore,given that the size of the offering is well below the size of the pool of identified green mortgages, there is minimal near-term risk thatthe balance of green bonds will exceed the balance of identified green assets.

In the future, ZKB may issue additional green bonds to refinance existing and future green assets in the identified pool. Per its greenbond framework, the bank has indicated that new green bonds will only be issued if the total outstanding volume of eligible mortgagesexceeds the pro forma volume of green bonds after a planned new issue by at least 10%. This practice will limit the chance that greenbonds outstanding will exceed the amount of identified green mortgages.

In the event that the volume of the outstanding green bonds exceeds the total outstanding volume of eligible mortgages at any time,the unallocated proceeds from green bonds will be temporarily held in a segregated account and invested in cash and/or in green bondsof other issuers with the following criteria:

» Currency: CHF, EUR or USD

» Ranking: senior unsecured

» Issuer rating: investment grade

» Minimum of 1 external review from providers including Moody's

Green bond proceeds will not be segmented by individual issuance or correspond to a specific pool of mortgages. That is, ZKB'sreporting will not link a subset of the pool of eligible mortgages with a corresponding green bond issuance.

Factor 4: Management of Proceeds Yes No

Bond proceeds are segregated and separately tracked on an accounting basis or via a method by which proceeds are earmarked ƔApplication of proceeds is tracked by environmental category and project type ƔRobust process for reconciling planned investments against actual allocations ƔClear eligibility rules for investment of cash balances ƔAudit by external organization or independent internal audit unit ƔFactor Score 1

Ongoing reporting and disclosure

1

Excellent

5

Poor

4

Fair

2

Very Good

3

Good

ZKB will publish a post-issuance green bond report on its website annually, a practice that will continue over the life of the bonds. Thereport will provide information including the current volume of green bonds outstanding, the current volume of mortgages for energy-efficient real estate, as well as updated impact reporting including the amount of CO2 reduction and savings on energy consumptioncompared to a Swiss average.

Impact reporting will follow up on the work the bank has completed with Minergie in its initial impact analysis, and therefore only applyto the group of mortgages with Minergie certifications. Furthermore, impact reporting will only be provided at the aggregate greenmortgage pool level and not be broken down by individual green bond issuance.

Although the annual report will provide updated impact assessments based on the composition of the pool of green mortgages atthe time of the impact report, the nature of the assets being refinanced limits certain aspects of the reporting. Given that the greenbond is refinancing individual mortgages for properties, there is no way to calculate actual energy efficiency benefits of the buildings



in practice. Instead, the reporting will be updated on a theoretical basis and highlight the aggregate savings the buildings are likelyachieving versus the baseline.

Factor 5: Ongoing Reporting and Disclosure Yes No

Reporting and disclosure post issuance provides/to be provided detailed and timely status updates on projects ƔOngoing annual reporting is expected over the life of the bond ƔDisclosures provide granular detail on the nature of the investments and their expected environmental impacts ƔReporting provides/to be provided a quantiative and/or qualitative assessment of the environmental impacts actually realized to-date ƔReporting includes/to include quantitative and/or qualitative explanation of how the realized environmental impacts compare to projections at

the time the bonds were soldƔ

Factor Score 3



Moody's Green Bond Assessment (GBA)Moody's GBA represents a forward-looking, transaction-oriented opinion on the relative effectiveness of the issuer's approach tomanaging, administering, allocating proceeds to and reporting on environmental projects financed with green bond proceeds. GBAs areexpressed using a five-point relative scale, ranging from GB1 (Excellent) to GB5 (Poor). A GBA does not constitute a credit rating.

Moody’s related publicationsMethodology:

» Green Bonds Assessment (GBA), March 30, 2016

Credit Opinion:

» Zuercher Kantonalbank: Update following assignment of Aaa issuer rating, March 23, 2018

Green Bond Assessment:

» Fransabank SAL: Green Bond Assessment - Series 1 Bonds, February 26, 2018

» Banco Nacional de Costa Rica: Green Bonds Assessment, December 12, 2017

» Bank of Communications Co., Ltd.: Green Bond Assessment, October 17, 2017

Sector In-Depth:

» Green Bonds - Global: Global municipal green bond issuance will continue to rise, March 19, 2018

» Green Bonds - Global: Global green bond issuance set to eclipse $250 billion in 2018, January 31, 2018

» Cross-sector - Global: FAQ: The green bond market and Moody's Green Bonds Assessment, November 29, 2017

» Green Bond Assessments - Global: Issuers exhibit strong organizational frameworks but differ on disclosure, September 19, 2017

To access any of these reports, click on the entry above. Note that these references are current as of the date of publication of thisreport and that more recent reports may be available. All research may not be available to all clients.


https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_188333





https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBM_1111531





© 2018 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDITRISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THERELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITYMAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGSDO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’SOPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVEMODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’SPUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOTPROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THESUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATIONAND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FORPURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FORRETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACTYOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW,AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTEDOR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANYPERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSESAND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as wellas other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information ituses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However,MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for anyindirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use anysuch information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses ordamages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of aparticular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatorylosses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for theavoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents,representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCHRATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (includingcorporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating,agreed to pay to Moody’s Investors Service, Inc. for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintainpolicies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO andrated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually atwww.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s InvestorsService Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intendedto be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, yourepresent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly orindirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion asto the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be recklessand inappropriate for retail investors to use MOODY’S credit ratings or publications when making an investment decision. If in doubt you should contact your financial or otherprofessional adviser.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’sOverseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a NationallyRecognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by anentity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registeredwith the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferredstock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it feesranging from JPY200,000 to approximately JPY350,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

REPORT NUMBER 1112448


http://www.moodys.com


Analyst Contacts

Matthew Kuchtyak [email protected]

CLIENT SERVICES

Americas 1-212-553-1653

Asia Pacific 852-3551-3077

Japan 81-3-5408-4100

EMEA 44-20-7772-5454


zuercher kantonalbank g… · in domestic investment banking operations in switzerland, as...

Documents