FMG rating under pressure 18 May 2009 5:14PM Philip Bayley FMG Finance Pty Ltd is the finance arm of Fortescue Metals Group (FMG) and has US$1.65 billion and €315 million of bonds on issue in the US s144A market with maturities ranging from September 2011 to September 2016. Moody's has placed its 'B1' senior secured rating on the bonds on review for possible downgrade, as a result of continuing weakness in the iron ore market and recent operating challenges in mining and processing. Moody's said the review will focus on the ability of FMG to ramp up production to the stated 36 million tonnes per annum by December 2009, and plans to improve operating costs. The review will also consider progress in relation to the shipping contract dispute, as well as the level of leasing arrangements which could potentially elevate legal subordination issues for the senior secured noteholders. Moody's affirmed the 'Aa1' senior unsecured rating assigned to Toyota Motor Corporation and its supported subsidiaries following the release of the group's annual accounts for the year to the end of March 2009. A negative outlook is assigned to the rating. It is a long time (2000) since Toyota Finance Australia has issued in the domestic corporate bond market but it has the equivalent of $4.3 billion of bonds (based on prevailing exchange rates at the time of issue) outstanding in the Euromarket and Uridashi market.Moody's affirmed the 'Baa2' underlying rating it assigns to Energy Partnership (Gas) Pty Ltd but moved the outlook to negative from stable, noting that "the company's financial metrics are weak relative to the tolerance set for its rating, and relative to other similarly-rated peers." The weak financial metrics within the Baa2 rating means that EPG has limited flexibility to manage worsening conditions in the operating environment, which is also a factor behind the change in outlook to negative. EPG has $685 million of bonds on issue in the domestic market with all but $135 million maturing in July, credit wrapped. The last issue undertaken by EPG, $300 million of July 2017 bonds, was wrapped by FSA.