Moody's: My Bank outlook negative

Moody's Investors Service said it changed to negative from stable the outlook on the following global scale ratings of My Bank: B3 long-term senior unsecured debt ratings, E+ bank financial strength rating and B3 long-term local- and foreign-currency deposit ratings.

At the same time, the bank's Not Prime short-term local- and foreign-currency ratings were affirmed, and Moody's Interfax Rating Agency affirmed the bank's Baa3.ru long-term national scale rating.

The agency said the outlook change reflects its concerns that the bank's risk profile has been deteriorating in 2010, which is mainly due to a considerable increase in the assumed market risk; the bank's capital adequacy has also weakened since 2009; and its recurring profitability remained negative in the first half of 2010.

Moody's believes that these negative developments in My Bank's credit quality are unlikely to undergo a rapid reversal and could pose a challenge to the sustainability of the bank's franchise in the medium term in the absence of external support. In that regard, the agency noted that My Bank's main shareholder has continued to provide extensive support to the bank in the past several years.

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