Moody's continues rating review for three Uzbek banks
MOSCOW. Nov 10 (Interfax) - Moody's Investors Service is maintaining its review of the long-term local currency deposit ratings of three Uzbek banks, National Bank of Uzbekistan, Ipoteka Bank and Alokabank, the agency said in a press release.
On May 21, 2009, Moody's placed these ratings on review for possible downgrade in order to assess the country's capacity to support its banking system in the midst of the global economic and financial crisis.
The rating agency believes that, in case of need, the Uzbek government is likely to support a number of large local banks deemed to be systemically important, as evidenced by a number of legislative and regulatory actions recently taken by the government. However, as the financial crisis wears on, the capacity of the country and its central bank to support the nation's banks may become somewhat constrained. As such, Moody's is in the process of reassessing the probability of systemic support. This element has a direct impact on the deposit ratings of the three Uzbek banks noted above.
Factors that the rating agency is considering in its reassessment of systemic support include the size of the banking system in relation to government resources, the level of stress in the banking system, the foreign currency obligations of the banking systems relative to the government's own foreign exchange resources, and changes to government political patterns and priorities.
The following ratings remain on review for possible downgrade:
- National Bank of Uzbekistan -- Long-term global local currency (GLC)
deposit rating of Ba3
- Ipoteka Bank -- Long-term GLC deposit rating of B1
- Alokabank -- Long-term GLC deposit rating of B1
The rating agency expects to conclude the review early next year.
All other ratings of these three banks and other bank ratings in Uzbekistan are unaffected by Moody's reassessment of the probability of systemic support.
Moody's previous rating action on the National Bank of Uzbekistan, Ipoteka Bank and Alokabank, was on May 21, 2009 when Moody's placed their local currency deposit ratings on review for possible downgrade.