Fitch affirms Halyk Bank's ratings at BB, outlook stable
ALMATY. Jan 22 (Interfax) - Fitch Ratings has affirmed Halyk Bank's (HB) and its 100%-owned subsidiary JSC Halyk Finance's (HF) Long-term foreign and local-currency Issuer Default Ratings (IDRs) at 'BB' with Stable Outlook, the rating agency said in a press release.
"The affirmation of HB's Long-term IDRs and senior debt ratings at 'BB' reflects limited recent changes to the bank's standalone credit profile. HB's Long-term IDRs are driven by its VR of 'bb', which in turn reflects the bank's established nationwide franchise, sound capitalisation, robust profitability, and adequate liquidity," the press release says.
The ratings factor in HB's still high levels of non-performing and restructured loans, high concentrations and significant foreign-currency loans to performing but unhedged borrowers, Fitch said.
The Stable Outlook reflects Fitch's view that that the bank has considerable resilience against risks stemming from a weakening of the operating environment, due to a fall in oil prices, and potential further devaluation of the tenge, according to Fitch.
"An upgrade of the ratings would result from a further loan book clean-up, combined with a proven resilience to the depressed oil price environment. The ratings could be downgraded if asset quality or capitalisation deteriorates sharply," the press release says.
HF's Long-term IDRs are aligned with the ratings of HB reflecting Fitch's view of the latter's high propensity to provide support to its subsidiary, if needed.
"HF's ratings would likely change in tandem with the parent bank's Long-term IDRs. The ratings could also be downgraded if support fails to be made available on a timely basis, if needed," the press release says.
Halyk Bank was ranked first by assets in January-September 2014 among the 38 second tier banks operating in the republic, according to the State Financial Supervision Committee of the Kazakh National Bank.
