Fitch affirms Ukrsotsbank, ups issuer default to B

Fitch Ratings said it upgraded Ukrsotsbank's long-term issuer default rating to B from B- and maintained the Rating Watch positive. Other ratings were affirmed at short-term issuer default B, individual D and support floor B-. The support rating of 5 remains on Rating Watch positive.

"The upgrade reflects Ukrsots' successful retail franchise expansion, which has been driving balance sheet and revenues diversification," Dmitri Angarov, associate director of Fitch's financial institutions team in Moscow, said in a written statement. "A sound bottom-line performance track-record and ongoing diversification of the funding base were also key rating uplift factors."

The ratings also continue to reflect the bank's well-established franchise and strong market positions in key customer segments despite the increasing competitive pressures, Fitch said.

The ratings also consider the bank's vulnerable liquidity position and low level of free equity, which affects capitalization, the agency said.

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