BELARUS NEWS AND ANALYSIS
DATE:
31/12/2008
Fitch Affirms VTB Bank (Belarus) at 'B'
Fitch Ratings-London/Moscow-31 December 2008: Fitch Ratings has today affirmed the ratings of VTB Bank (Belarus) (VTBB), including its Long-term Issuer Default Rating (IDR) of 'B' with a Stable Outlook and its Individual Rating of 'E'. A full list of the bank's ratings follows at the end of this commentary.
VTBB's IDRs and Support Rating of '4' reflect Fitch's view on the probability of support which could be provided by the bank's parent, JSC Bank VTB (VTB - Long-term IDR 'BBB+' /Outlook Negative/Individual 'C/D'), the second largest state-owned bank in Russia. Fitch also notes the small size of VTBB relative to VTB. At the same time, the ability of VTB to provide support to its Belarusian subsidiary may be constrained by Belarusian transfer/convertibility risks.
VTBB's Individual Rating reflects the risks arising from its extremely rapid recent asset growth, high concentrations on both sides of its balance sheet, the weaknesses in the operating environment and its potentially vulnerable stand-alone liquidity resulting mostly from short-term customer funding. In November 2008, VTBB received a USD100m credit facility from VTB Bank (Austria) AG ('BBB'), a European subsidiary of VTB, to offset a (mainly planned) outflow of customer funding.
Upward or downward pressure on VTBB's IDRs and Support Rating is contingent on the improvement or deterioration in Belarusian transfer/convertibility risks, and hence the state of Belarusian government finances. Upside potential for the bank's Individual Rating is currently limited.
VTBB, formerly Slavneftebank, is a universal bank, predominantly focused on serving corporate customers. At end-November 2008, VTBB ranked eighth by asset size in Belarus, with a 2.2% market share in banking system assets, 2.3% in corporate lending and 0.8% in retail deposits. VTBB is 64.9% owned by VTB. VTBB's ratings have been affirmed as follows:
Long-term foreign currency IDR: affirmed at 'B'; Outlook Stable
Short-term foreign currency IDR: affirmed at 'B'
Support Rating: affirmed at '4'
Individual Rating: affirmed at 'E'
Contact: James Watson, Moscow, Tel: +7 495 956 9901.
Media Relations: Alla Izmailova, Moscow, Tel: +7 495 956 9903, Email: alla.izmailova@fitchratings.com; Hannah Warrington, London, Tel: +44 (0) 207 417 6298, Email: hannah.warrington@fitchratings.com.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, '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.
Source:
Archive
Subscribe Daily Newsletter:
Belarus News and Analysis Donate:
