Moody's rates Vostochny Express Bank B3

Moody's Investors Service said it assigned B3/not-prime long-term and short-term deposit ratings and an E+ financial strength rating to Vostochny Express Bank.

The outlook is stable.

The ratings reflect the bank's small but rapidly expanding franchise in the lucrative and fast-growing Russian retail lending market, Moody's said.

The ratings are supported by the bank's strong position in its home region of the Russian Far East, where the bank currently operates the second-largest retail distribution network and also has the second-largest retail loan portfolio in the region. The bank's strong profitability, adequate capitalization and good loan book granularity are the key positive rating drivers, the agency said.

The bank's ratings are constrained by the bank's short track record under its present business model and its high level of operational and credit risks stemming from its aggressive growth strategy and its focus on the riskiest segment of the retail loan market, the agency added.

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