Fitch cuts, withdraws Uraltransbank

Fitch Ratings said it downgraded Uraltransbank's (UTB) long-term issuer default rating to CC from CCC and removed it from Rating Watch Negative.

The agency simultaneously withdrew the ratings for commercial reasons.

Fitch downgraded Uraltransbank’s long-term issuer default rating to CCC and placed it on negative watch on Nov. 14. This was due to the bank being in breach of the minimum regulatory Tier 1 capital requirement and significant uncertainty with respect to its ability to restore compliance, and hence the risk of regulatory intervention, Fitch explained.

“Today's rating actions reflect a further material weakening of the bank's capital position since the last review, and hence an increased risk, in the agency's view, of regulatory intervention,” the agency said in a news release.

“In January 2018, UTB's capital base was further eroded by impairment-driven losses, leading to both the core Tier 1 and Tier 1 capital ratios dropping to 3.3% and the total capital ratio falling to 6.2%, all below the minimum levels of, respectively, 4.5%, 6% and 8%.”

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