Thursday’s massive trading error won’t affect the credit ratings of the Japanese firm that made it, says Fitch Ratings.

The rating agency today affirmed the ratings of the three operating banks of Mizuho Financial Group following a large sell order error at group subsidiary Mizuho Securities that occurred on December 8.

Fitch said that the latest reported estimate for the loss to Mizuho Securities caused by this error is about US$225 million. “However, the loss could exceed this amount depending on market factors and if it is necessary for Mizuho Securities to settle the erroneous sell order in full,” it noted.

Fitch noted that the equity capital of Mizuho Securities stood at ¥381.8 billion at the end of September, while the consolidated equity of the whole Mizuho group stood at ¥3,683.3 billion. Moreover, Mizuho Financial has announced that it intends to provide full support to Mizuho Securities, and given the vast capital and liquidity resources of the Mizuho group, Fitch believes that Mizuho Securities should face no problems continuing with its normal business.

“While the cost of dealing with the sell order error will certainly have a negative impact on the profitability of Mizuho Securities in the fiscal year ending March 2006, the impact on the profitability of the Mizuho group as a whole is likely to be limited,” it noted.

“Consequently, although this incident underlines the necessity for financial institutions to closely control their internal processes and reduce as much as possible their exposure to operational risk events, Fitch believes that Mizuho has the capacity to absorb the costs of dealing with yesterday’s sell order error with little impact on the creditworthiness of the group as a whole,” it said.