International rating agency Moody's Investors Service has cut its long-term local currency and foreign currency deposit ratings on Bank Uralsib from B2 to Caa1, with a negative outlook, and also the bank's baseline credit assessment from b2 to caa1. As the agency said in a press release, these actions came following the revision of the ratings, which was initiated in mid-March as the agency's methodology changed.
At the same time, Moody's affirmed the bank's short-term local currency and foreign currency deposit ratings at Not Prime.
Bank Uralsib's deposit ratings were lowered as its baseline credit assessment deteriorated that, in turn, reflects weak indicators of the bank's financial standing, in particular, poor asset quality, low capital adequacy ratios and losses that the bank has reported over the past four years and, as Moody's thinks, the bank will not be able to overcome in 2015. All these things are aggravated by hard macroeconomic conditions in Russia.
In addition, the bank was assigned long-term and short-term counterparty risk assessments of B3(cr)/Not Prime(cr). This kind of the rating, which the agency introduced not long ago, measures the likelihood of fulfillment by a financial institution, if it defaults, of its contractual obligations.
Alongside this, Moody's said that it affirmed ratings of five other banks and assigned counterparty risk assessments to 23 banks.
In particular, Bank FC Otkritie's long-term local currency and foreign currency deposit ratings were affirmed at Ba3, Tinkoff Bank's at B2, Bank Saint Petersburg' and Transcapitalbank's (foreign currency ones), and also Credit Europe Bank's ratings at B1, and the outlook for all the ratings is negative. Bank FC Otkritie, Bank Saint Petersburg and Transcapitalbank had their baseline credit assessments affirmed at b1, Tinkoff Bank and Credit Europe Bank at b2 (the latter's adjusted baseline credit assessment was affirmed at b1). The full list of rating actions is shown in the agency's press release.
Counterparty risk assessments were assigned to the five above banks, and also to Absolut Bank, Bank Alba Alliance, Asian Pacific Bank, Bank Intesa, Bank Kuban Credit, DeltaCredit, Finprombank, First Czech-Russian Bank, Bank MBA-Moscow, Investtorgbank, Bank Avangard, Rosbank, Metallinvestbank, Bank National Standard, NC Bank, Petersburg Social Commercial Bank, Rosenergobank, and Russlavbank. Assessment levels are also shown in the agency's press release.
