Moody's rates Royal Bank of Canada bonds Aaa

Moody's Investors Service said it assigned the provisional rating of Aaa to the series CB9 covered bonds to be issued by Royal Bank of Canada under its $12 million program for the issuance of covered bonds existing under the terms of its €15 billion global covered bond program.

Because the covered bondholders first have recourse to the issuer, Moody's said it assumes that the issuer will continue to make all payments due to covered bond holders while it remains solvent.

The agency said it uses the senior unsecured debt rating of the issuer as a means to determine the likelihood of default for a typical covered bond.

The issuing bank, RBC, is an Aa3 rated bank, and thus the likelihood of default by the sponsor is very low, Moody's said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.