Any crisis that would lead Beijing to default on its debt would likely be dire enough to affect Hong Kong, Vincent Truglia, managing director and co-head of sovereign risk at Moody's Investors Service, said. That was the main reason Hong Kong and China carry the same investment grade A3 sovereign rating from the New York-based agency. Moody's has been criticised by many people in Hong Kong financial circles for not differentiating between credit risk here and China. Rival agency Standard and Poor's rates China much lower than Hong Kong. While Moody's makes no distinction between sovereign risk here and in China, the agency does rate the banks at different levels. Hong Kong's biggest banks carry an A3 rating but mainland banks foreign exchange borrowings are rated at least one notch lower at Baa1 and their domestic currency deposits are rated at least two notches lower at Baa2. Failing to pay on sovereign debt would usually take something more than a current account crisis, Mr Truglia said. 'What would cause China to default on a sovereign bond?' he asked. 'It wouldn't simply be a balance of payments crisis; it would have to be a major disruption to China's ability to export. 'We have to ask ourselves: would Hong Kong be immune to a major disruption in China? Would the subtleties of international agreements be observed in these kinds of circumstances?' Mr Truglia said the risk of such an occurrence was 'very low', but if there was a full-blown crisis in China, the last thing Beijing would be worried about was Hong Kong.