Russian rating agency RAEX (Expert RA) has confirmed its creditworthiness rating of B++ (satisfactory level of creditworthiness) on Uniastrum Bank, and reduced the rating outlook from developing to negative, RAEX's press service reported.
"The reduction of the rating outlook was related, first and foremost, to the nonoptimum breakdown of equity (as of January 1, 2016 additional capital accounted for 53.1% of aggregate equity) and to the bank's aggressive policy of drawing retail deposits (in November 2015 net growth of funds drawn from households equaled 23.4%, and 42.6% in December)," the agency noted.
The agency's analysts think that the rating is pressured by the credit portfolio's poor quality (as of January 1, 2016 loans of the third to fourth quality categories accounted for 35.6%) coupled with an insufficiently conservative provisions policy, high capital immobilization (95% of equity are immobilized by funds invested in property and other low-liquidity assets as of January 1, 2016).
Meanwhile, the rating is positively influenced by high coverage of the credit portfolio (taking into consideration the collateral of securities, sureties and guarantees the credit portfolio's coverage ratio equaled 1,046.1%, and 114.6% excluding these collaterals as of January 1, 2016) and high instant and current liquidity ratios (N2 was equal to 103.2%, and N3 equaled 171.1% as of January 1, 2016), RAEX added.