MOODY'S ASIAN LIQUIDITY STRESS INDEX FALLS TO RECORD LOW IN AUGUST

KUALA LUMPUR, Sept 5 (Bernama) -- Moody's Investors Service's monthly Asian
Liquidity Stress Index fell to a record low in August, with just 9.7 per cent or
some 10 names, of its rated speculative-grade portfolio demonstrating inadequate
liquidity.

Its Vice President and Senior Credit Officer Laura Acres said that the
index, which declines when corporate liquidity increases, has been between 11
and 13 per cent since the start of the year, and was at 11.4 per cent in July.

"At the same time, the August improvement was issuer-specific, rather
than a broad improvement across the high-yield spectrum," she said in a
statement, Monday.

She also said that the high level of corporate liquidity in Asia continues
to suggest a low probability of default for the region's speculative-grade
companies.

"However, looking ahead, we think speculative-grade companies could face
higher costs, and weaker ones could find access to credit more limited if
investors, particularly those outside the region, decide that it is too
risky to lend to low-rated companies.

"Investors are increasingly concerned about the fallout from problems some
European sovereigns are facing, and fears there could be another global
recession," she added.

With the Asia-Pacific, excluding Japan, trailing 12-month speculative-grade
default rate, Moody's expects the index could fall further in the third quarter
of this year to as little as 0.38 per cent, Laura said.

However, she said, there is a risk that it could rise if there is a material
change in the banking-system stress, due to the ongoing European sovereign debt
crisis or adverse developments for specific issuers.

The Asian Liquidity Stress Index, which Moody's publishes each month,
examines liquidity trends throughout the Asia-Pacific region (ex-Japan
and Australia) for the speculative-grade companies rate and quantifies
the proportion of companies with inadequate liquidity.

-- BERNAMA