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IBI-Rating has affirmed the credit rating of «BM BANK» JSC at uaBBB+ grade
23.09.2016
IBI-Rating informs on affirming of the credit rating of «BM BANK» JSC at uaBBB+ grade, with a «developing» outlook.
The affirmed credit rating grade of «BM BANK» JSC is due to its acceptable capitalization and liquidity ratios, as well as good diversification of the customer deposit portfolio by major depositors. At the same time, the Bank's vulnerability to certain financial risks persists due to market conditions and unstable situation in the country. The Rating agency also notes the Bank's susceptibility to credit risk, which is caused by the concentration of the customer loan portfolio by major borrowers; a significant proportion of foreign currency denominated loans granted to the borrowers who have no sources of foreign exchange earnings, which, inter alia, increases the Bank’s vulnerability to currency risk. Sanctions applied against some companies of the Russian Federation (including the main shareholder of the Bank) hinders the completion of the increasing of capitalization of «BM BANK» JSC.
Given the formation of a significant amount of loan loss reserves for the outstanding loans of customers, the Bank's activities by the results of І half year of 2016 were unprofitable. Accordingly, performance indicators remained at a low level. In its turn, the Rating agency IBI-Rating notes the owner’s support by involving his funds in the form of long-term inter-bank loans and subordinated debt.
IBI-Rating currently sees no factors, which may lead to a change in the Bank's credit rating grade in the short term. The following factors may have an impact on the credit rating grade: a decline of the Bank’s solvency (liquidity), increased credit risks due to deterioration of servicing of the granted loans, increased vulnerability of the Bank to market risks, increased unprofitability, as well as deterioration of the political and economic situation in the country.
In order to conduct the analytical research the materials provided by «BM BANK» JSC have been used, including: annual financial statements for 2013-2015 and 6 months of 2016 , target performance indicators, other necessary internal information, as well as the information from the public sources, which the Rating agency considers credible.
Financial Department.
For additional information please contact:
Press office of IBI-Rating
(044) 362-90-84
press(at)ibi.com.ua
The affirmed credit rating grade of «BM BANK» JSC is due to its acceptable capitalization and liquidity ratios, as well as good diversification of the customer deposit portfolio by major depositors. At the same time, the Bank's vulnerability to certain financial risks persists due to market conditions and unstable situation in the country. The Rating agency also notes the Bank's susceptibility to credit risk, which is caused by the concentration of the customer loan portfolio by major borrowers; a significant proportion of foreign currency denominated loans granted to the borrowers who have no sources of foreign exchange earnings, which, inter alia, increases the Bank’s vulnerability to currency risk. Sanctions applied against some companies of the Russian Federation (including the main shareholder of the Bank) hinders the completion of the increasing of capitalization of «BM BANK» JSC.
Given the formation of a significant amount of loan loss reserves for the outstanding loans of customers, the Bank's activities by the results of І half year of 2016 were unprofitable. Accordingly, performance indicators remained at a low level. In its turn, the Rating agency IBI-Rating notes the owner’s support by involving his funds in the form of long-term inter-bank loans and subordinated debt.
IBI-Rating currently sees no factors, which may lead to a change in the Bank's credit rating grade in the short term. The following factors may have an impact on the credit rating grade: a decline of the Bank’s solvency (liquidity), increased credit risks due to deterioration of servicing of the granted loans, increased vulnerability of the Bank to market risks, increased unprofitability, as well as deterioration of the political and economic situation in the country.
In order to conduct the analytical research the materials provided by «BM BANK» JSC have been used, including: annual financial statements for 2013-2015 and 6 months of 2016 , target performance indicators, other necessary internal information, as well as the information from the public sources, which the Rating agency considers credible.
Financial Department.
For additional information please contact:
Press office of IBI-Rating
(044) 362-90-84
press(at)ibi.com.ua