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Fitch Rates Krayinvestbank's Upcoming Bond Issue 'B+(EXP)'
August 29, 2013 / 1:47 PM / 4 years ago

Fitch Rates Krayinvestbank's Upcoming Bond Issue 'B+(EXP)'

(The following statement was released by the rating agency) LONDON/MOSCOW, August 29 (Fitch) Fitch Ratings has assigned Krayinvestbank's (KIB) upcoming RUB2bn BO-03 Series domestic bond issue an expected Long-term local currency rating of 'B+(EXP)' and a National Long-term rating of 'A-(rus)(EXP)'. The bond's expected Recovery Rating is 'RR4(EXP)'. The bonds have a maturity of six years, a semi-annual coupon and a 1.5 year put option. KIB has a Long-term foreign currency Issuer Default Rating (IDR) of 'B+' with Stable Outlook, a Short-term IDR of 'B', a Long-term local currency IDR of 'B+' with Stable Outlook, a National Rating of 'A-(rus)' with Stable Outlook, a Viability Rating of 'b-' and Support Rating of '4' . KEY RATING DRIVERS The issue ratings correspond to KIB's 'B+' Long-term local currency IDR, which reflects the limited probability of support that KIB may receive if needed from Krasnodar Region (KR, BB+/Stable), which directly owns a 98.04% stake in the bank. Fitch's view of the propensity to provide support is based on KR's majority ownership and a track record of assistance to date. However, Fitch considers there is some uncertainty in respect of support in light of the bank's limited systemic importance for the region and some corporate governance issues. RATING SENSITIVITIES Any changes to KIB's Long-term local currency IDR would impact the issue ratings. Downside pressure on KIB's Long-term foreign and local currency IDR could arise from any major weakening in the relationship between KR and the bank, for example, as a result of changes in key senior regional officials. Upside potential for KIB's Long-term local currency IDR is limited in the near term, but a reduction in construction exposure which may be largely related to KR and its officials would be credit positive. Contacts: Primary Analyst Dmitry Vasiliev Associate Director +7 495 956 9901 Fitch Ratings CIS Limited 26 Valovaya Street, Moscow 115054 Secondary Analyst Ruslan Bulatov Analyst +7 495 956 9901 Committee Chairperson James Watson Managing Director +7 495 956 6657 Media Relations: Julia Belskaya von Tell, Moscow, Tel: +7 495 956 9908, Email: julia.belskayavontell@fitchratings.com; Hannah Huntly, London, Tel: +44 20 3530 1153, Email: hannah.huntly@fitchratings.com. Additional information is available at www.fitchratings.com. Applicable criteria, 'Global Financial Institutions Rating Criteria', dated August 2012, are available at www.fitchratings.com. Applicable Criteria and Related Research: Global Financial Institutions Rating Criteria here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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