Contacts Akzo Nobel N.V. VP-Sr Credit Officer…coatings and Sikkens for specialty and wood coatings are two well-known AkzoNobel-owned brands amongst others. Management expects the

CORPORATES

CREDIT OPINION19 December 2019

Update

RATINGS

Akzo Nobel N.V.Domicile Amsterdam,

Netherlands

Long Term Rating (P)Baa1

Type Senior Unsecured MTN- Dom Curr

Outlook Stable

Please see the ratings section at the end of this reportfor more information. The ratings and outlook shownreflect information as of the publication date.

Contacts

Martin Kohlhase +49.69.70730.719VP-Sr Credit [email protected]

Matthias Hellstern +49.69.70730.745MD-Corporate [email protected]

Akzo Nobel N.V.Update to Discussion of Key Credit Factors

SummaryAkzoNobel's Baa1 rating reflects the capital structure transformation with the €10.1 billionnet proceeds from the disposal of specialty chemicals. This results in expected 2019 Moody's-adjusted debt/EBITDA of around 2.2x which takes into account the redemption of €1.3 billionof debt, €700 million of pension fund top ups and a total disbursement to shareholders of€6.5 billion, not counting the additional €500 million share buy-back programme announcedin October 2019. The company retains about €1.0 billion of disposal proceeds earmarked forM&A.

At the same time AkzoNobel continues with its transformation programmes regarding itsoperating efficiencies. Benefits support the return on sales target of 15% that the companyaims to achieve by 2020 (“15 by 20”). Operating profitability at this level will help to closethe gap against peers in the coatings and paint sector.

Exhibit 1

Leverage and profitability

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

-5.0x

-4.0x

-3.0x

-2.0x

-1.0x

0.0x

1.0x

2.0x

3.0x

4.0x

2015 2016 2017 2018 2019e

Debt / EBITDA (LHS) Net Debt / EBITDA (LHS) EBITDA margin (RHS)

Source: Company filings, Moody's

This document has been prepared for the use of Romy Hu and is protected by law. It may not be copied, transferred or disseminated unless authorizedunder a contract with Moody's or otherwise authorized in writing by Moody's.

http://www.surveygizmo.com/s3/1133212/Rate-this-research?pubid=PBC_1205770

MOODY'S INVESTORS SERVICE CORPORATES

Credit Strengths

» Strong business profile underpinned by leading market positions and balanced geographical exposure between developed andemerging economies

» Improved underlying operating performance driven by comprehensive restructuring/efficiency initiatives

» Financial profile supported by free cash flow (FCF) generation and pension de-risking measures

» Capacity to adjust capital structure to accommodate loss of Specialty Chemicals cash flows

» Strong liquidity profile bolstered by partially retained disposal proceeds

Credit Challenges

» Constraints on organic growth reflecting maturity of European market amid Brexit uncertainties and exposure to cyclical endmarkets

» Reduced scope and diversity post disposal of Specialty Chemicals and concentration on buildings and infrastructure, andtransportation sectors

» Lower profitability vis a vis US peers

» Event risk amid ongoing sector consolidation

» Sizeable pension obligations requiring annual top-up contributions, albeit reduced following recent de-risking actions

Rating OutlookThe company is well-positioned within the rating category. The stable outlook reflects Moody´s expectation that AkzoNobel will maintainits strong cash flow generation and gross leverage, as defined and adjusted by Moody´s, of between 2.0x-2.5x over the next 12 to 18months.

Factors that Could Lead to an Upgrade

» EBITDA margins consistently above 15%

» RCF/net debt in the mid to high 30s (%)

» Debt/EBITDA sustained below 2.0x

Factors that Could Lead to a Downgrade

» EBITDA margins falling towards 10%

» RCF/net debt falling towards 20%

» Debt/EBITDA above 2.5x

This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page onwww.moodys.com for the most updated credit rating action information and rating history.

2 19 December 2019 Akzo Nobel N.V.: Update to Discussion of Key Credit Factors



Key Indicators

12/31/2015 12/31/2016 12/31/2017 12/31/2018 9/30/2019(L)

Revenue (USD Billion) $16.5 $15.7 $16.5 $10.9 $10.5

PP&E (net) (USD Billion) $5.0 $5.1 $5.7 $2.4 $2.2

EBITDA Margin 15.8% 16.3% 15.7% 12.7% 13.9%

Return on Average Assets 9.3% 9.1% 8.9% 4.7% 6.2%

Debt / EBITDA 1.8x 2.0x 2.3x 2.8x 2.5x

EBITDA / Interest Expense 11.8x 15.0x 15.3x 7.9x 12.2x

RCF / Debt 31.9% 33.4% 23.4% 19.5% 25.2%

RCF / Net Debt 45.6% 48.7% 31.0% -12.8% 77.7%

All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non-Financial Corporations.Source: Moody’s Financial Metrics™

ProfileAkzoNobel is a leading producer of paints and coatings. In 2018, it generated total sales of €9.3 billion. The group serves a diversifiedcustomer base in all major regions in which it has production facilities, and it has an extensive international manufacturing presence.In 2018, it derived 40% of revenues from decorative paints, 19% from industrial coatings, 13% from powder coatings, 15% fromautomotive and specialty coatings and 14% from marine and protective coatings. AkzoNobel's market capitalization on December 172019 was approximately € 18.3 billion.

Exhibit 3

Balanced regional exposure between developed and emergingeconomiesSales by region (FY 2018)

Exhibit 4

Segmental splitSales (FY 2018)

Mature Europe34%

Asia Pacific31%

North America12%

South America9%

Emerging Europe9%

Other regions5%

Source: Annual Report 2018 - Akzo Nobel N.V.

Decorative Paints Europe, Middle East and Africa22%

Decorative Paints South America5%

Decorative Paints Asia12%

Marine and Protective Coatings14%

Automotive and Specialty Coatings15%

Industrial Coatings19%

Powder Coatings13%

Source: Annual Report 2018 - Akzo Nobel N.V.




Detailed Credit ConsiderationsDisposal of Specialty Chemicals resulted in reduced scope, size and diversityThe divestment of the Specialty Chemicals business in October 2018 has significantly reduced AkzoNobel's business scope. Thecompany now focuses exclusively on paints and coatings. As a focussed paints and coatings company, AkzoNobel's exposure to thebuildings & infrastructure sectors accounts for about 40%. AkzoNobel's regional footprint is equally-balanced between developed andemerging markets. The exposure to input cost fluctuations has become more concentrated with resins, solvents, titanium dioxide andpackaging as main raw materials.

Leading market positions in paint supported by strong brands, but no presence in key North American marketThe Decorative Paints segment generated €3.7 billion of sales in 2018, with 56% of segment sales from the EMEA region, 31% fromAsia and 13% from Latin America. AkzoNobel is notably absent from key markets such as North America and Japan. The size ofmarkets where the company is present accounts for about €30 billion of revenues. AkzoNobel typically has number 1 or 2 positionsin its markets. This compares with average annual volume growth of 2% in the period 2008-2017. End markets are the buildings andinfrastructure sectors and 75% of its segment revenues stem from more stable maintenance, renovation and repair work. Amongst itsbrands are Dulux, the leading decorative paint brand in the UK, and Sikkens.

The Performance Coating segment accounted for €5.6 billion of sales in 2018, or around 60% of group sales. The regional exposurefor Coatings is better balanced than for Decorative Paints with EMEA accounting for 42% of sales followed by Americas with 27%and Asia-Pacific with 31%. Coatings are primarily sold directly to industrial customers primarily spanning the shipping, oil & gas,automotive, transportation and the consumer goods sectors. AkzoNobel has number one market positions in relevant markets forMarine and Protective Coatings and Power Coatings and number one and two positions in Industrial Coatings. Interpon in powdercoatings and Sikkens for specialty and wood coatings are two well-known AkzoNobel-owned brands amongst others.

Management expects the global market for paints and coatings to grow by 2-3% in the period 2017-2020.

Expectation of further acquisition-driven growth and sector consolidation likelyAkzoNobel has been supplementing growth by making bolt-on and mid-sized acquisitions, which we expect the company to continue.It has retained €1.0 billion of disposal proceeds and we believe that the funds will be used to fund acquisitions. In December 2019AkzoNobel announced the acquisition of Mauvilac, completed the acquisition of Mapaero in November 2019 and in December2018 bought out the minority shareholder in its AkzoNobel Swire Paints joint venture. In September 2018 alone the companyannounced and closed two acquisitions, Xylazel in Spain and Doves Decorating Supplies in the UK, followed by the completion ofFabryo Corporation S.R.L. in October, after announcement in June 2018. Xylazel added about 100 employees and had annual sales ofapproximately €20 million in 2017. In 2017 AkzoNobel made three acquisitions and in 2016 it acquired the Industrial Coatings businessof BASF (SE) (A2 stable) for €425 million.

The paint and coatings industry has more recently witnessed large-scale consolidation, such as Sherwin-Williams' acquisition ofValspar and the subsequent disposal of Valspar's industrial wood coatings business to Axalta as well as take-over attempts by PPG forAkzoNobel, merger talks between Axalta and AkzoNobel that ultimately failed and Nippon Paint's negotiations to merge with Axalta.We would not rule out renewed merger/take-over advances by a large peer in the future. This poses a degree of event risk, althoughnow moderately diminished post the Specialty Chemicals separation.

Focus on further performance improvements amid challenging market conditionsPost the separation of Specialty Chemicals, management targets a return on sales (ROS, EBIT margin; excludes unallocated corporatecenter costs and invested capital) of 15% and return on investment of more than 25% by 2020. It aims to achieve these goals bygrowing by about 2.0%, centralising supply chain management and SG&A cost management with the goal to realise recurring savingsof €310 million per year against total one-off costs of €350 million, of which €290 million cash costs and €60 million asset write-offs,between 2018 and 2020. By September end 2019 AkzoNobel was on track to deliver annual savings of €210 million it had plannedas part of its phase one transformation and has about €100 million yet to deliver. We caution that in the event that increases in rawmaterial costs and adverse conditions in end markets cannot be passed on to its customers that this could erode the full benefit fromthese savings. Since the beginning of 2019, however, AkzoNobel has actually encountered relief from lower raw material prices whichalso explains the improvement of the Moody's-adjusted EBITDA margin for the last twelve months ending September of 13.9%.



https://www.moodys.com/credit-ratings/BASF-SE-credit-rating-78520


Exhibit 5

Historical EBITDA and EBITDA margin split by segment€ million

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

0

100

200

300

400

500

600

700

800

900

1,000

2014 2015 2016 2017 2018 LTM Sept 19

€ m

illio

n

Decorative Paints (DP) Performance Coatings (PC) DP EBITDA Margin (RHS) PC EBITDA Margin (RHS)

Source: Company filings

The ROS target of 15% would essentially close the performance gap that AkzoNobel has vis a vis its closest peers PPG Industries, Inc.(A3 negative), Sherwin-Williams Company (The) (Baa3 positive) or Axalta Coating Systems Ltd. (Ba3 stable).

Exhibit 6

AkzoNobel's EBIT margins lagging behind peers

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

2014 2015 2016 2017 2018 LTM

Akzo Nobel N.V. PPG Industries, Inc. Sherwin-Williams Company (The) Axalta Coating Systems Ltd.

Source: Moody's Financial Metrics

Improved financial profile after earmarking €1.3 billion to debt repaymentAkzoNobel received €10.1 billion from the sale of Specialty Chemicals, of which €6.5 billion have been earmarked for shareholderreturns: a €1.0 billion special dividend already paid in 2017, a €1.0 billion special dividend in Q1 2019, a €2.0 billion capital reductionin Q1 2019 and €2.5 billion share buy backs in 2019-2020. AkzoNobel also repaid its €800 million notes that matured in 2018 andrepaid its €500 million notes in November 2019 in addition to making a pension fund contributions of €481 million year-to-date.Tax and transaction costs amounted to €500 million leaving €1.0 billion of net proceeds that AkzoNobel retains on its balance sheet.Reported gross debt at FYE2019 will be around €1.9 billion after the above measures in our estimate and adjusted gross debt around€3.56 billion. Consequently, we expect debt/EBITDA of 2.2x in 2019 and 1.9x in 2020.



https://www.moodys.com/credit-ratings/PPG-Industries-Inc-credit-rating-618000

https://www.moodys.com/credit-ratings/Sherwin-Williams-Company-The-credit-rating-676400

https://www.moodys.com/credit-ratings/Axalta-Coating-Systems-Ltd-credit-rating-823271977


Exhibit 7

AkzoNobel plans further share repurchasesUse of disposal proceeds

1951

-7812

620

2000

1000

2500500

759

-7000

-6000

-5000

-4000

-3000

-2000

-1000

0

1000

2000

3000

Net debt (2017) Net cash generationand proceeds (specialty

chemicals)

Pension contributions Capital repayment andshare consolidation

Special dividend (2019) Share buyback (2019)* Share buyback (2020)** Net debt (2020)

€ m

illion

*As of 29 November 2019, AkzoNobel repurchased shares in amount of €2.4 billion**AkzoNobel announced to repurchase further shares in amount of around €500 million in the first half of 2020Source: Investor presentation - Q3 2019, Moody's Investors Service

Pension de-risking initiatives positive but UK top-up payments do not boost Moody's-adjusted metricsAkzoNobel has, in the past years, taken a number of initiatives to manage and de-risk these liabilities. In 2017 alone pension fund trusteesof the UK-based ICI Pension Fund (ICIPF) entered into three additional annuity buy-in agreements covering in aggregate £0.4 billion.This is in addition to ICIPF and AkzoNobel (CPS) Pension Scheme (CPS) investments of a total of around £8.7 billion in buy-in annuitytransactions in prior years. ICIPF and CPS account for 82% of DBO and 90% of plan assets.

The contributions have helped significantly reduce the volatility that may affect AkzoNobel’s pension funding deficit in the future. Asshown in exhibit 9, the annual top-up payments (mainly into ICIPF and CPS) AkzoNobel committed to make in the period 2018-21, havebeen reduced to €190-200 million compared to around €300 million in the period 2014-17.

Exhibit 8

Estimated Cash Top-ups

0

100

200

300

400

500

600

700

2016 2017 2018 2019e 2020e 2021e 2022e 2023e

€ m

illio

n

Cash Cash to escrow account

Relate mainly to two UK plans: ICI Pension Fund and the Courtaulds Pension Scheme.Source: Investor presentation - Q3 2019 results

While both schemes are in surplus under IFRS accounting (IAS 19), they still show a combined deficit estimated at £934 (€1.054 billionat 31 March 2017), in accordance with UK actuarial valuation regulations. Significantly, it is the actuarial, as opposed to IFRS, valuation ofthe schemes’ funded status, which will determine the size of the top-up contributions AkzoNobel will need to make into ICIPF and CPSin coming years. The triennial review of both plans concluded in March 2017.

The pension fund contributions of €481 million year-to-date help further contain the volatility that may affect the plans’ funded statusin the future, as well as reduce uncertainty as to the size of the future top-up pension contributions the group will have to be pay outof cash flow.




However, we note that the top-up contributions made into the two UK schemes do not reduce the adjustment Moody’s makes toAkzoNobel’s debt for pension obligations, even though they eat into its cash flow and inflate its funded net debt. The adjustment reflectsthe gross deficit indicated by the pension liability on the balance sheet, rather than the net deficit revealed by the overall funded statusof the pension plans in aggregate.

This approach is based on the premise that surpluses built in some of a company’s pension plans cannot be transferred to cover deficitsaccumulated in some of its other schemes. Therefore, we do not net the surpluses recorded by ICIPF and CPS under IFRS against thedeficits shown by AkzoNobel’s other schemes. Besides, given that the assumptions retained under IFRS are less conservative than thoseapplied by UK actuaries, it may be argued that IFRS fails to appropriately dimension the true underfunding of ICIPF and CPS, and identifythe need for top-up contributions.

Liquidity AnalysisAkzoNobel's liquidity continues to be supported by annual funds from operations of around €1.0 billion and cash holdings (including short-term investments) of around €2.2 billion as of end September 2019 (around €1.7 billion pro-forma the November bond redemption). Thecompany has access to a €1.8 billion committed revolving credit facility maturing 2022 without any financial covenants. On October 232019, the company announced a new share buyback program of €500 million which will be completed in the first half of the year 2020.AkzoNobel next sizeable debt, a €750 million bond, matures in July 2022.

Rating Methodology and Scorecard FactorsFollowing the disposal of the specialty chemical activities, AkzoNobel has a reduced scale as measured by revenues that weighs on theforward-looking scorecard-indicated outcome of Baa2. We expect the company to improve some of its metrics such as EBITDA marginand coverage over time, but it is likely to become visible by year-end 2020. The indicated outcome from the scorecard of Baa2 doesnot take into account the sizeable cash balances that the company retains.

Chemical Industry Scorecard [1][2]

Factor 1 : Scale (15%) Measure Score Measure Score

a) Revenue (USD Billion) $10.5 Baa $10 - $11 Baa

b) PP&E (net) (USD Billion) $2.2 Ba $2.1 - $2.3 Ba

Factor 2 : Business Profile (25%)

a) Business Profile A A A A

Factor 3 : Profitability (10%)

a) EBITDA Margin 13.9% Ba 13.5% - 14.5% Ba

b) ROA (Return on Average Assets) 6.2% B 6% - 7% B

Factor 4 : Leverage & Coverage (30%)

a) Debt / EBITDA 2.5x Baa 2.1x - 2.3x Baa

b) RCF / Debt 25.2% Baa 23% - 25% Baa

c) EBITDA / Interest Expense 12.2x Baa 14x - 17x A

Factor 5 : Financial Policy (20%)

a) Financial Policy Baa Baa Baa Baa

Rating:

a) Indicated Outcome from Scorecard Baa2 Baa2

b) Actual Rating Assigned Baa1

Current

LTM 9/30/2019

Moody's 12-18 Month Forward View

As of 12/16/2019 [3]

[1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non-Financial Corporations;[2] As of 09/30/2019(L);[3[ This represents Moody's forward view; not the view of the issuer; and unless noted in the text, does not incorporate significant acquisitions and divestitures.Source: Moody’s Financial Metrics™




Appendix

Exhibit 10

Akzo Nobel N.V. peer comparison

(in US millions)

FYE

Dec-17

FYE

Dec-18

LTM

Sep-19

FYE

Dec-17

FYE

Dec-18

LTM

Sep-19

FYE

Dec-17

FYE

Dec-18

LTM

Sep-19

FYE

Dec-17

FYE

Dec-18

LTM

Sep-19

Revenue $16,468 $10,931 $10,538 $14,748 $15,374 $15,119 $14,984 $17,534 $17,851 $4,377 $4,696 $4,550

EBITDA $2,587 $1,389 $1,470 $2,910 $2,787 $2,799 $2,701 $3,222 $3,409 $901 $948 $960

Total Debt $6,429 $3,744 $3,536 $5,762 $6,554 $6,945 $12,240 $11,082 $10,706 $4,413 $4,336 $4,231

Cash & Cash Equiv. $1,574 $9,432 $2,391 $1,436 $902 $1,432 $204 $156 $190 $770 $694 $767

EBITDA Margin 15.7% 12.7% 13.9% 19.7% 18.1% 18.5% 18.0% 18.4% 19.1% 20.6% 20.2% 21.1%

ROA - EBIT / Avg. Assets 8.9% 4.6% 6.2% 12.8% 11.9% 11.8% 12.0% 10.1% 11.3% 7.8% 7.8% 8.3%

EBITDA / Int. Exp. 15.3x 7.9x 12.2x 17.6x 15.2x 15.6x 8.2x 7.1x 7.9x 5.4x 5.1x 5.2x

Debt / EBITDA 2.3x 2.8x 2.5x 2.0x 2.4x 2.5x 4.5x 3.4x 3.1x 4.9x 4.6x 4.4x

RCF / Debt 23.4% 19.5% 25.2% 31.0% 27.6% 25.8% 17.0% 18.8% 20.3% 15.1% 15.9% 16.6%

Baa1 Stable A3 Negative Baa3 Positive Ba3 Stable

Akzo Nobel N.V. PPG Industries, Inc. Sherwin-Williams Company (Th Axalta Coating Systems Ltd.


Exhibit 11

Akzo Nobel N.V. historical Moody's adjusted debt breakdown

(in US Millions)FYE

Dec-14

FYE

Dec-15

FYE

Dec-16

FYE

Dec-17

FYE

Dec-18

LTM Ending

Sep-19

As Reported Debt 4,040.4 2,814.6 2,880.5 3,930.2 2,741.3 2,985.0

Pensions 1,516.2 1,254.7 1,276.3 1,269.2 577.3 550.6

Operating Leases 442.7 629.0 705.6 760.1 425.2 0.0

Non-Standard Adjustments 10.9 5.4 5.3 469.5 0.0 0.0

Moody's-Adjusted Debt 6,010.2 4,703.7 4,867.7 6,429.1 3,743.8 3,535.5

Source: Moody’s Financial Metrics™

Exhibit 12

Akzo Nobel N.V. historical Moody's adjusted EBITDA breakdown

(in US Millions)FYE

Dec-14

FYE

Dec-15

FYE

Dec-16

FYE

Dec-17

FYE

Dec-18

LTM Ending

Sep-19

As Reported EBITDA 2,230.8 2,530.3 1,810.2 1,676.7 1,072.3 1,295.0

Pensions 2.7 -103.3 -121.7 -13.6 63.8 60.9

Operating Leases 148.8 214.3 246.7 238.4 146.4 35.0

Interest Expense – Discounting -42.5 -18.9 -31.0 -18.1 0.0 -14.7

Unusual 0.0 0.0 0.0 75.7 129.9 118.4

Non-Standard Adjustments -27.9 -18.9 659.5 628.2 -23.6 -24.8

Moody's-Adjusted EBITDA 2,311.9 2,603.6 2,563.7 2,587.4 1,388.8 1,469.8

Source: Moody’s Financial Metrics™




Exhibit 13

Akzo Nobel N.V. historical Moody's adjusted financial dataIn EUR Million 2015 2016 2017 2018 LTM

INCOME STATEMENT

Revenues 14,859 14,197 14,575 9,256 9,342

EBITDA 2,345 2,317 2,290 1,176 1,303

EBIT 1,547 1,512 1,493 830 956

BALANCE SHEET

Cash&Cash Equivalents 1,297 1,449 1,311 8,251 2,193

Total Debt 4,330 4,615 5,354 3,275 3,243

Total Net Debt 3,033 3,166 4,043 (4,976) 1,050

CASH FLOW

Funds from Operations 1,663 1,879 1,599 1,086 1,262

Change in Working Capital items 58 1 (105) (205) (261)

Cash Flow from Operations 1,721 1,880 1,494 881 1,001

Capital Expenditures (CAPEX) (811) (833) (440) (267) (285)

Dividends (281) (336) (346) (447) (446)

Free Cash Flow (FCF) 629 711 708 167 270

Retained Cash Flow (RCF) 1,382 1,543 1,253 639 816

RCF / Debt 31.9% 33.4% 23.4% 19.5% 25.2%

RCF / Net Debt 45.6% 48.7% 31.0% -12.8% 77.7%

FCF / Debt 14.5% 15.4% 13.2% 5.1% 8.3%

PROFITABILITY

EBIT Margin % 10.4% 10.6% 10.2% 9.0% 10.2%

EBITDA Margin % 15.8% 16.3% 15.7% 12.7% 13.9%

INTEREST COVERAGE

EBIT / Interest Expense 7.8x 9.8x 10.0x 5.5x 9.0x

EBITDA / Interest Expense 11.8x 15.0x 15.3x 7.9x 12.2x

LEVERAGE

Debt / EBITDA 1.8x 2.0x 2.3x 2.8x 2.5x

Net Debt / EBITDA 1.3x 1.4x 1.8x -4.2x 0.8x





Ratings

Exhibit 14

Category Moody's RatingAKZO NOBEL N.V.

Outlook StableSenior Unsecured MTN -Dom Curr (P)Baa1Commercial Paper P-2Other Short Term -Dom Curr (P)P-2

AKZO NOBEL SWEDEN FINANCE AB (PUBL)

Outlook StableBkd Senior Unsecured Baa1

Source: Moody's Investors Service




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Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (includingcorporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating,agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintainpolicies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO andrated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually atwww.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s InvestorsService Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intendedto be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, yourepresent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly orindirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as tothe creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’sOverseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a NationallyRecognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by anentity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registeredwith the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferredstock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for ratings opinions and services rendered by it feesranging from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

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Contacts Akzo Nobel N.V. VP-Sr Credit Officer…coatings and Sikkens for specialty and wood coatings are two well-known AkzoNobel-owned brands amongst others. Management expects the