S&P revises two Mongolian banks to stable

S&P said it revised the outlooks on Trade and Development Bank of Mongolia LLC (TDB) and Golomt Bank of Mongolia to stable from negative and affirmed their B- long-term and B short-term issuer credit ratings.

In addition, the agency affirmed the B- long-term and B short-term issue ratings on TDB's debt. It also affirmed the B- long-term and B short-term issuer credit ratings on Development Bank of Mongolia LLC (DBM).

The outlook on DBM remains stable.

S&P said the actions reflect its view that the Mongolian banking industry's reliance on external funding has reduced even though overall funding conditions remain tight.

The agency revised its view of the country's banking sector industry risk trend to stable from negative.

In its base case, S&P expects that the banking sector's two-year average net external debt as a percentage of total domestic loans will peak by end-2017 and then trend below 20%, the threshold supporting our current assessment.

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