DVB Bank SE discontinues rating contracts with Moody’s Investors Service

In June 2012 Moody’s Investors Service (Moody’s) took various rating actions on German banks and their subsidiaries. DVB received a significant rating downgrade of up to three notches in various rating categories (long-term rating Baa1/stable outlook), while Standard and Poor’s (S&P) upgraded DVB’s long-term counterparty credit rating by one notch to A+/stable outlook in December 2011 and the ratings by FitchRatings (Fitch) allocated within the scope of the German Co-operative Financial Services Network remained unchanged at A+/stable outlook. Thus, the S&P and Fitch ratings are currently three notches above the Moody’s rating.

After discussing this material discrepancy with investors and business partners, the Board of Managing Directors decided to terminate all contracts with Moody’s within the given timeframe. The Bank assumes that Moody’s will withdraw all ratings on DVB promptly.

Wolfgang F. Driese, CEO and Chairman of the Board of Managing Directors, commented on this decision:

“Firstly, we discontinue the rating contracts with Moody’s as the ratings assigned by the agency don’t reflect DVB’s strong performance in the international transport finance business anymore:

- we have shown record results amidst the world economic crisis years;
- we have successfully steered the bank through four years of shipping downturn;
- we have proven and reliable access to the liquidity of the German Co-operative Financial Services Network.

Secondly, the gap of three rating notches between the S&P and Fitch ratings (A+ level) and the current Moody’s rating (Baa1 level) is hard to justify and difficult to understand for all participants in the financial and in the transportation markets. This might cause misconceptions about DVB which we need to avert.

Thirdly, S&P and Fitch are globally reputable agencies, offering independent credit ratings to our equity and debt investors. In the end, we came to the conclusion that a third rating is quite dispensable."