Moody's cuts International Industrial Bank

Moody's Investors Service said it downgraded the deposit and debt ratings of International Industrial Bank to B3 from B1. The bank's bank financial strength rating remains unchanged at E+, but it now maps to a baseline credit assessment of B3, down from B1. All ratings have been placed on review for possible further downgrade.

The downgrades were driven by the bank's considerably weakened liquidity profile, as the volume of liquid assets was on a declining trend over recent months, Moody's said.

The agency also noted that the bank's deposit base was historically highly concentrated, which raised concerns about the sustainability and tolerance of the bank's clientele.

Going forward, without access to refinancing facilities, the bank would need to cut its loan book by up to 50% in three months, which would have a severe effect on its franchise and earnings generation capacity, Moody's said.

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