Fitch Ratings has placed the 'AA-' Long-Term Issuer Default Ratings (IDRs) of OCBC Wing Hang Bank Limited (WHB) and Banco OCBC Weng Hang, S.A. (BWH) on Rating Watch Negative (RWN).

Fitch has also affirmed the two banks' Short-Term IDRs at 'F1+' and Support Ratings at '1'.

The rating actions follow the placement of the 'AA-' Long-Term IDR and 'aa-' Viability Rating of their Singapore-based ultimate parent Oversea-Chinese Banking Corporation Limited (OCBC) on RWN due to increased near-term downside risks following the economic downturn stemming from the coronavirus pandemic. See 'Fitch Places OCBC's 'AA-' Long-Term IDR on Rating Watch Negative', published on 29 April 2020 at https://www.fitchratings.com/site/pr/ 10120220.

KEY RATING DRIVERS

IDRS AND SUPPORT RATING

WHB's IDRs and Support Rating reflect Fitch's view of OCBC's high ability and propensity to provide extraordinary support to WHB if needed. Fitch equalises WHB's Long-Term IDR with that of OCBC due to WHB's key and integral role in Greater China, one of OCBC's core markets, and the high level of management and operational integration. BWH's IDRs and Support Rating are driven by our expectation of extraordinary support from OCBC, through its immediate parent, WHB, if required. OCBC's risk management policies and relevant systems have been largely implemented at WHB and at its subsidiaries, including BWH, while there is a little local discretion to fulfil local authorities' requirements.

Fitch believes both WHB and BWH have become increasingly important to OCBC as China continues to develop its Greater Bay Area. WHB's consolidated assets represented about 10% of the group's assets and the bank contributed about 9% of group profit at end-2019.

The two subsidiaries with the Wing Hang brand have a long presence in the two Special Administrative Regions of China. This helps the banks retain local customers and build deposit franchises, which provide OCBC with more flexible Hong Kong and US dollar funding and strengthen the group's funding and liquidity position in Greater China.

RATING SENSITIVITIES

IDRS AND SUPPORT RATING

Factors that could, individually or collectively, lead to positive rating action/upgrade:

Positive rating action on the IDRs is unlikely given the RWN placed on WHB and BWH and its parent OCBC.

Factors that could, individually or collectively, lead to negative rating action/downgrade:

We will resolve the RWN upon the resolution of the RWN on parent OCBC, which is expected in the next six months. Any negative rating action on OCBC's IDRs and VR will lead to downgrade of WHB's and BWH's IDRs.

A downgrade could also result if Fitch believes that the parent's propensity to support the two subsidiaries has diminished because of strategic considerations, and it may affect the Support Rating if the change in propensity is significant. However, Fitch does not consider this to be likely in the medium term.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score of 3. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity(ies), either due to their nature or to the way in which they are being managed by the entity(ies). For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/esg.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Financial Institutions issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specific best- and worst-case scenario credit ratings, visit https://www.fitchratings.com/site/re/10111579.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING

The principal sources of information used in the analysis are described in the Applicable Criteria.

RATING ACTIONS

ENTITY/DEBT	RATING		PRIOR
OCBC Wing Hang Bank Limited	LT IDR	AA- 	Rating Watch On		AA-
ST IDR	F1+ 	Affirmed		F1+
LC LT IDR	AA- 	Rating Watch On		AA-
Support	1 	Affirmed		1
Banco OCBC Weng Hang, S.A.	LT IDR	AA- 	Rating Watch On		AA-
ST IDR	F1+ 	Affirmed		F1+
Support	1 	Affirmed		1

VIEW ADDITIONAL RATING DETAILS

Additional information is available on www.fitchratings.com

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