Moody’s downgrades credit ratings of Belarus’ two major banks from stable to negative
<p> MINSK, Oct 5 - PrimePress. Moody’s Investors Service (Moody’s) has changed to negative from stable the outlooks on Belinvestbank’s B3 long-term deposit ratings, OAO Sber Bank’s B2 long-term local-currency (LC) deposit rating and its B3 long-term foreign currency (FC) deposit rating, as well as the two banks’ issuer outlooks. All of the banks’' ratings and assessments were affirmed. </p> <p> </p> <p> “The negative outlooks on the two banks’ long-term deposit ratings reflect Moody’s expectations that their ratings will likely be downgraded in case of a downgrade of [Belarus’] sovereign rating”. </p> <p> </p> <p> Moody’s says Belinvestbank’s BCA is constrained by its unstable operating environment, thin core equity capital buffer and substantial dollarisation of deposits amid constrained foreign-currency liquidity. At the same time, it is supported by the bank’s ample liquidity buffers, its strong loan-loss reserve coverage of problem loans and the strong linkage of its asset quality to the sovereign creditworthiness. </p> <p> </p> <p> OAO Sber Bank’s b3 BCA is constrained by its operating environment characterised by increased political uncertainty, high external vulnerability and a weak economic outlook; the bank's large stock of problem loans and narrowed net interest margin. Factors underpinning OAO Sber Bank’s BCA are its solid capital and reserves buffer and access to stable funding sources and the parent's liquidity in case of need. </p> <p> </p> <p> The rating actions follow the change of the outlook on Belarus's B3 sovereign rating to negative from stable on 1 October 2021. According to Moody’s, the key drivers for the change in the outlook to negative are: 1) Heightened debt refinancing risks given tightening economic and financial sanctions that constrain financing options; and 2) Belarus's limited reserves reduce capacity to withstand further shocks amid heightened political instability. </p> <p> </p> <p> Sber Bank (formerly known as BPS-Sberbank before 27 Aug 2021) is one of the largest banks in Belarus in terms of assets. More than 95% of active cards in the bank's card portfolio are issued on the basis of its own local processing centre. The main shareholder of Sber Bank is Russia’s Sberbank (98.43%). </p> <p> </p> <p> Belarus’ Development and Reconstruction Bank – Belinvestbank - was incorporated on September 3, 2001 as a result of merging two banks together Belarusian Development Bank and Belarus Business Bank. The state share in the bank's authorised capital is 99.08%. Belinvestbank is the country’s Tier 1 bank. There are more than 110 branches of the bank in Belarus. Belinvestbank has been under US sanctions since 9 August 2021. End </p>
2021-10-06
Primepress
Moody’s downgrades credit ratings of Belarus’ two major banks from stable to negative
MINSK, Oct 5 - PrimePress. Moody’s Investors Service (Moody’s) has changed to negative from stable the outlooks on Belinvestbank’s B3 long-term deposit ratings, OAO Sber Bank’s B2 long-term local-currency (LC) deposit rating and its B3 long-term foreign currency (FC) deposit rating, as well as the two banks’ issuer outlooks. All of the banks’' ratings and assessments were affirmed.
“The negative outlooks on the two banks’ long-term deposit ratings reflect Moody’s expectations that their ratings will likely be downgraded in case of a downgrade of [Belarus’] sovereign rating”.
Moody’s says Belinvestbank’s BCA is constrained by its unstable operating environment, thin core equity capital buffer and substantial dollarisation of deposits amid constrained foreign-currency liquidity. At the same time, it is supported by the bank’s ample liquidity buffers, its strong loan-loss reserve coverage of problem loans and the strong linkage of its asset quality to the sovereign creditworthiness.
OAO Sber Bank’s b3 BCA is constrained by its operating environment characterised by increased political uncertainty, high external vulnerability and a weak economic outlook; the bank's large stock of problem loans and narrowed net interest margin. Factors underpinning OAO Sber Bank’s BCA are its solid capital and reserves buffer and access to stable funding sources and the parent's liquidity in case of need.
The rating actions follow the change of the outlook on Belarus's B3 sovereign rating to negative from stable on 1 October 2021. According to Moody’s, the key drivers for the change in the outlook to negative are: 1) Heightened debt refinancing risks given tightening economic and financial sanctions that constrain financing options; and 2) Belarus's limited reserves reduce capacity to withstand further shocks amid heightened political instability.
Sber Bank (formerly known as BPS-Sberbank before 27 Aug 2021) is one of the largest banks in Belarus in terms of assets. More than 95% of active cards in the bank's card portfolio are issued on the basis of its own local processing centre. The main shareholder of Sber Bank is Russia’s Sberbank (98.43%).
Belarus’ Development and Reconstruction Bank – Belinvestbank - was incorporated on September 3, 2001 as a result of merging two banks together Belarusian Development Bank and Belarus Business Bank. The state share in the bank's authorised capital is 99.08%. Belinvestbank is the country’s Tier 1 bank. There are more than 110 branches of the bank in Belarus. Belinvestbank has been under US sanctions since 9 August 2021. End