Moody’s Investors Service yesterday confirmed it was shutting down its operations in Taiwan and Indonesia in response to the global economic downturn, while rival Fitch Ratings said it would continue to grow its business in these two markets.
In an e-mailed statement to the Taipei Times yesterday, Moody’s, the world’s second-largest credit-rating firm, said it would focus on other markets in the Asia-Pacific region following a review of its business strategy.
“After a strategic review of our business, we concluded that we can most efficiently serve the Asian markets from our regional hubs in Hong Kong, Singapore, Sydney and Tokyo,” the New York-based Moody’s said in the statement.
“We also plan to maintain our strong affiliate relationships in Korea, China and India,” the firm said.
Both Taiwan and Indonesia are among markets where Moody’s has decided to pull out in late June to cope with adverse credit market conditions. The ratings agency last week also decided to close its South Bend office in Indiana, according to a filing with the US Securities and Exchange Commission.
JOB CUTS
Moody’s, which began its operations in Taiwan in 2003, said the closings would eliminate between 3 percent and 4 percent of its total work force, or a cut of 120 to 170 jobs in the three offices, the filing showed.
Eleanor Sheung, a communications strategist at Moody’s Asia Pacific Ltd based in Hong Kong, yesterday declined to comment on whether the company’s withdrawal from Taiwan was prompted by price competition and reduced business scale in a market where it is competing fiercely with Fitch Ratings and Standard & Poor’s.
The Chinese-language Commercial Times reported yesterday that Moody’s was in talks with the Financial Supervisory Commission, hoping to maintain the validity of its credit ratings on local clients such as Taiwan Power Co (台電)
The commission has not yet made a response to Moody’s withdrawal from Taiwan market and whether it will allow Moody’s local clients to continue using the firm’s credit ratings.
FITCH RATINGS
Meanwhile, Fitch Ratings said it remained committed to markets in Taiwan and Indonesia, despite current adverse market conditions.
“As clearly demonstrated through its on the ground presence and increasing visibility, Fitch Ratings remains committed to enhancing its coverage with a view to serving investors and market participants in Indonesia and Taiwan, and indeed across the region,” Evan Hale, managing director of Fitch Asia-Pacific, said in a statement.
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