S&P Global Ratings has given Mitsubishi UFJ Financial Group's (TYO:8306) $1 billion perpetual, subordinated additional tier one (AT1) notes a BB+ long-term issue credit rating, according to a Wednesday release.

The issuance complies with Basel III rules under Japan's requirements, according to S&P.

The AT1 notes' rating is five notches under S&P's "a" standalone credit profile for the group, since extraordinary government support would be unlikely.

The notes have intermediate equity content, which further anchors S&P's view that the issuer will maintain steady capitalization in the next one to two years.

The issuance should also buoy the banks' diversification efforts for its long-term foreign currency funding profile amid rising overseas lending demands.