Moody’s downgrades Vneshprombank

Moody's Investors Service said it downgraded Vneshprombank's long-term global, local and foreign-currency deposit and senior unsecured debt ratings to B3 from B2 and affirmed the Not-Prime short-term local and foreign currency deposit ratings.

The outlook on the long-term ratings is negative.

Concurrently, the agency downgraded the bank's baseline credit assessment (BCA) and adjusted BCA to b3 from b2 and long-term counterparty risk assessment (CR Assessment) to B2(cr) from B1(cr). It also affirmed the bank's short-term CR Assessment of Not-Prime(cr).

At the same time, Moody's Interfax Rating Agency downgraded the national scale long-term deposit rating to Baa3.ru from Baa1.ru. The national scale rating carries no specific outlook.

Moody’s said the downgrade reflects increased vulnerability of Vneshprombank's credit profile amid the ongoing deterioration of the domestic operating environment, given the bank's: (a) Weak loss absorption capacity – as reflected in its weak capital adequacy metrics, relatively low level of Loan Loss Reserves (LLR) and weakening profitability; (b) high credit risk appetite, as reflected in the bank's rapid lending growth in recent years; and (c) concentrated funding base which could face increased volatility.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.