Moody's rates Investec Tier 1 preferreds Ba2

Moody's Investors Service said it assigned a Ba2 rating to the provisional €150 million fixed/floating-rate guaranteed non-voting non-cumulative perpetual preferred securities issued by Investec Tier 1 (UK) LP. The issue is guaranteed by Investec plc (rated Baa3).

The rating has a stable outlook.

Moody's said the instrument includes various equity-like features and will receive 50% equity credit and 50% debt treatment for leverage purposes (Basket C under Moody's Hybrid Criteria). The main contributing features include: a) a degree of permanence through its stated perpetual maturity and capital replacement language; b) optional deferral in the event payment would exceed available distributable profits, or if the guarantor's board of directors has resolved not later than the day falling 10 Business Days in London prior to a distribution payment date that no distributions should be made; c) loss absorption as a result of the instrument's junior position in the Group's capital structure.

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