Japan-based investment holding company SoftBank Group Corp.'s /zigman2/quotes/207137761/delayed SFTBY -1.29% credit was downgraded Wednesday two notches at Moody'a Investors Service, and is now three notches deep into "junk" territory. The ratings agency citing said the rating cut, to Ba3 from Ba1, follows the company's announcement this week that it will monetize up to 4.5 trillion yen (about $41 billion) of its investment portfolio, and use the proceeds to buy back up to 2 trillion yen ($18 billion) of its stock. SoftBank responded by saying there was "no rationale" for a 2-notch downgrade, and will cause "substantial misunderstanding" among investors and "signficant confusion" for issuers as the downgrade "deviates substantially" from Moody's stated criteria. As a result, Softbank asked Moody's to withdraw its ratings. Meanwhile, Moody's said the rating is place on review for further downgrade, as volatile market conditions could further weaken the valuation of SoftBank's investments. "The two-notch downgrade to Ba3 reflects [SoftBank's] aggressive financial policy, as reflected by the unexpected size and apparent urgency of the rapid series of share repurchases, just as the drop in the stock market has put the value and liquidity of its portfolio value under stress," Moody's said. Softbank's U.S.-listed shares, which were still inactive in premarket trading, has lost 26.3% over the past month, while the S&P 500 /zigman2/quotes/210599714/realtime SPX +1.36% has declined 21.8%.