S&P rates Alfa Bank euro CP program C

Standard & Poor's said it has assigned its C short-term rating to the $200 million euro-commercial paper program of the Alfa Bank group.

The issuing entities are Netherlands-based Alfa-Russia Finance BV and Cyprus-based Alfa Debt Market Ltd. The program is guaranteed jointly and severally by ABH Financial Ltd., based in the British Virgin Islands, and by Alfa Bank (B/stable/C).

At the same time, S&P assigned its ruA+ Russian national scale rating to Alfa Bank and to the bank's Russian ruble 1 billion five-year senior unsecured bond issue due June 2007, issued by OOO AlfaFinance, a subsidiary company of Alfa Bank. The bond is fully guaranteed by Alfa Bank.

"The ratings on Alfa Bank reflect the bank's good business franchise and the improved diversity of its business lines, offset by its large single-party concentrations, including to other Alfa Group members, and the still high level of operating risk for all banks operating in the Russian Federation," said S&P credit analyst Ekaterina Trofimova.

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