Moody's upgrades 12 Russia governments

Moody's Investors Service said it upgraded the ratings of 12 regional governments in Russia and two government-related issuers.

The upgrades reflect an easing in systemic pressures following the upgrade of Russia's sovereign rating to Baa3 from Ba1, Moody's said, as well as idiosyncratic credit improvements.

The City of Moscow to Baa3 from Ba1, City of St. Petersburg to Baa3 from Ba1, Oblast of Moscow to Ba1 from Ba2, Republic of Bashkortostan to Ba1 from Ba2, Republic of Tatarstan to Ba1 from Ba2, Khanty-Mansiysk AO to Ba1 from Ba2, Oblast of Samara to Ba2 from Ba3, Republic of Chuvashia to Ba2 from Ba3, Krai of Krasnodar to Ba3 from B1, Krai of Krasnoyarsk to Ba3 from B1, Republic of Komi to Ba3 from B1 and Oblast of Nizhniy Novgorod to Ba3 from B1.

SUE Vodokanal of St. Petersburg also was upgraded to Ba1 from Ba2 and OJSC Western High-Speed Diameter was upgraded to Ba2 from Ba3.

Moody's also affirmed Oblast of Omsk at Ba3, City of Omsk at B1, City of Krasnodar at B1 and City of Volgograd at B2.

Improvements in tax administration have helped increase revenue from existing sources and expand the tax base for these governments, Moody's said.

Together with tighter cost controls, higher revenues have improved these regions' operating performances in the last two years and also provide greater financial flexibility for through 2021, the agency said.

Following these rating actions, the long-term issuer rating of Oblast of Moscow carries a positive outlook while long-term ratings of all other affected governments are stable.

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