Fitch affirms ten regional Russian banks
MOSCOW. Dec 4 (Interfax) - Fitch Ratings has affirmed the Long-term foreign currency Issuer Default Ratings (IDR) of ten Russian regional banks and has placed certain ratings of Russia-based LLC CBED Bank of Kazan (BoK), including its Long-term (IDR) of 'B-', on Rating Watch Negative (RWN), the agency said in a press release.
The placing of BOK's ratings on RWN reflect the probable dilution of the City of Kazan's ('B+'/Stable) stake in the bank to 25% from 81% as a result of a share issue which is planned for Q110. BoK's ratings currently reflect potential support from the City, given the bank's ownership structure and strong relations with the City administration. While these connections may be maintained after the share issue, for as long as the current City administration remains in office, the RWN reflects the risk of a less supportive relationship, in particular if the City administration changes after mayoral elections scheduled for the end of 2010. Fitch expects to resolve the RWN based on the post-share issue evolution of relations between the City and the bank, although a resolution of the rating watch may take place only following the elections.
The Outlooks on the Long-term IDRs of 'B-' of International Bank of Saint Petersburg, Primsotsbank (PSB), SKB-Bank, Bank Snezhinskiy, Spurt Bank and Uraltransbank (UTB) remain Negative and reflect a combination of already evident asset quality deterioration, the potential for further loan impairment and moderate loss absorption capacity relative to the losses the banks may need to book in a downside scenario. The downgrade of UTB's National Long-term rating to the same 'BB-(rus)' level as most of its peers reflects the considerable deterioration in its asset quality. At the same time, Fitch notes that funding has been stable at each of these banks in recent months, liquidity is reasonable and capital cushions provide the capacity to increase reserves to 15% or more of loan books (around 26% for UTB and PSB) without breaches of minimum capital requirements.
The Negative Outlook on BTA-Kazan's Long-term IDR of 'CCC' continues to reflect the potential for contagion risk from the other assets and broader fortunes of the bank's majority shareholders. However, the bank's credit profile is supported by currently significant capital and liquidity cushions.
The Stable Outlooks on Petersburg Social Commercial Bank's and Sarovbusinessbank's Long-term IDRs of 'B-' reflect their substantial loss absorption capacity and, so far, moderate reported loan impairment levels. The revision of the Outlook on Chelindbank's Long-term IDR of 'B' to Stable from Negative reflects its significant capital cushion, a levelling off of asset quality trends in Q209-Q309 and the stable and significant franchise in its home region.
The rating actions are as follows:
LLC CBED Bank of Kazan
Long-term foreign currency IDR: 'B-'; placed on RWN
Short-term foreign currency IDR: 'B'; placed on RWN
Individual Rating: affirmed at 'E'
Support Rating: affirmed at '5'
National Long-term Rating: 'BB(rus)'; placed on RWN
JSC BTA-Kazan (OJSC)
Long-term foreign currency IDR: affirmed at 'CCC'; Outlook Negative
Short-term foreign currency IDR: affirmed at 'C'
Individual Rating: affirmed at 'E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
National Long-term Rating: affirmed at 'B(rus)'; Outlook Negative
Chelindbank
Long-term foreign currency IDR: affirmed at 'B-'; Outlook revised to Stable from Negative
Short-term foreign currency IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
National Long-term Rating: affirmed at 'BB(rus)'; Outlook revised to Stable from Negative
International Bank of Saint Petersburg
Long-term IDR: affirmed at 'B-'; Outlook Negative
Short-term IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
National Long-term Rating: affirmed at 'BB-(rus)'; Outlook Negative
Petersburg Social Commercial Bank
Long-term IDR: affirmed at 'B-'; Outlook Stable
Short-term IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No floor'
National Long-term Rating: affirmed at 'BB-(rus) '; Outlook Stable
Primsotsbank
Long-term IDR: affirmed at 'B-'; Outlook Negative
Short-term IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No floor'
National Long-term Rating: affirmed at 'BB(rus)'; Outlook Negative
Sarovbusinessbank
Long-term IDR: affirmed at 'B-'; Outlook Stable
Short-term IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
National Long-term Rating: affirmed at 'BB-(rus)'; Outlook Stable
SKB-Bank
Long-term foreign currency IDR: affirmed at 'B-'; Outlook Negative
Short-term foreign currency IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Bank Snezhinskiy PJSC
Long-term IDR: affirmed at 'B-'; Outlook Negative
Short-term IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No floor'
JSC Spurt Bank
Long-term foreign currency IDR: affirmed at 'B-'; Outlook Negative
Short-term foreign currency IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Uraltransbank
Long-term foreign currency IDR: affirmed at 'B-'; Outlook Negative
Short-term foreign currency IDR: affirmed at 'B'
Individual Rating: affirmed at 'D/E'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
National Long-term Rating: downgraded to 'BB-(rus)' from 'BB(rus)'; Outlook Negative