S&P lowered the ratings of 19 Russian banks
On June 3, 2014, the international rating agency Standard & Poor’s revised the outlook to negative on 18 Russian banks, and to stable on one other and affirmed the counterparty credit ratings on these banks. In addition, the Agency affirmed the ratings on 13 banks; their outlooks remain unchanged.
The list of banks, which forecast was lowered to the negative estimation, includes Baltic Financial Agency Bank, Bank Vozrozhdenie, Bank Tavrichesky, CB Intercommerz Ltd., CentroCredit Bank JSC, Commercial Bank OBRAZOVANIE, Commercial Bank Petrocommerce OJSC, Commercial Bank Sudostroitelny Bank LLC, Federal Bank for Innovation and Development, International Bank of Saint-Petersburg, InterProgressBank, Investtradebank JSC, Krayinvestbank, LLC CB Koltso Urala, Mezhtopenergobank OJSC, Nota Bank, OJS Commercial Bank Rost Bank, and Ural Bank for Reconstruction and Development. The rating of Bank Soyuz was revised from positive to stable. However, the long-term ratings of the banks were not revised.
The Agency noted that the economic and industry risk trend affecting Russian banks is negative now.
“We believe weaker-than-previously expected economic growth over the next few years will likely have a negative impact on Russian banks' lending growth, asset quality, and profitability. We also consider that geopolitical tensions between Russia and Ukraine and weakening confidence of international and domestic investors toward Russia will put increasing pressure on the funding profiles of Russian banks," – reported S&P.
Thus, the Agency forecasted weaker GDP growth of nearly 1% in 2014, and considered the downside risks to be substantial. "A lack of structural reform has left the economy vulnerable to fluctuations in world commodity prices, particularly oil, and to slow growth in the global economy," said S&P.
According to the Agency, such conditions will lead to slower lending growth, higher credit costs, and lower profitability for banks. It will also likely weigh on the capitalization of the banking sector.
You should be authorized to post comment
Russia planted spring grains throughout over 26 mln ha - Ministry of Agriculture
Russia: in the fourth week of May, Russian seaports decreased grain export volumes
Russia: in January-April, NCSP Group increased grain shipment volumes
Russia exported over 32 mln tonnes of grains - Ministry of Agriculture
Russia continued exporting grains to Turkey as normal - Rosselkhoznadzor
In the first quarter of 2017, Russia exported over 8 mln tonnes of cereal crops - Rosstat
Ministry of Economy of Turkey denies imposition of restrictions on the imports of Russian agricultural products
May 26, 16:50