IBI-Rating has affirmed the rating of bank deposit reliability of "MOTOR BANK" PJSC at grade 4

IBI-Rating informs on the affirmation of the rating of bank deposit reliability of "MOTOR BANK" PJSC at grade 4 (high reliability).

The rating of bank deposit reliability at grade 4 indicates that the financial institution is reliable, pays timely its obligations within the requirements established by the current legislation of Ukraine, including those of the National Bank of Ukraine. The likelihood of problems with a timely return of deposits is low, although there is a certain dependence of the financial institution on the impact of external and internal factors. The impact assessment of external factors does not apply to the situations involving force majeure circumstances.

The affirmed rating of "MOTOR BANK" PJSC is due to its maintaining of an adequate level of capitalization, as evidenced by the sufficient actual value of the capital adequacy ratio but the amount of equity capital provides only partial coverage of credit and investment risks. The Bank adheres to regulatory requirements, and meets its obligations to creditors in a timely manner and in full. The actual values of liquidity ratios are at a sufficient level. However, the impact on susceptibility to financial risks may increase as a result of the persistence of negative trends in the economy and reduced solvency of borrowers. Despite the fact that the main part of the resource base are amounts due to customers, which are formed mainly by balances on the current accounts of legal entities, and are, on the one hand, a cheap resource, though, on the other hand, there are gaps between assets and liabilities by their terms to maturity in separate zonal periods, thus, there is certain sensitivity of the Bank to liquidity risk. But the above-mentioned is offset by a permanent part of balances on customer current accounts and support of the parent company. It should be noted that such a structure of liabilities causes a significant concentration of the Bank's resource base by major creditors, which limits its financial flexibility. During the analyzed period there was a rise in dependence on the financial condition of major borrowers, which increases the Bank’s vulnerability to credit risk. Based on the results of January-September 2015, the Bank's operations were profitable, and its performance indicators remained high. The Rating agency did not reveal any complaints from the customers to the Bank’s operations and in the opinion of «IBI-Rating», the financial institution, if necessary, can count on the owners’ support.

A positive impact on the rating of bank deposit reliability may have the following: reduced dependence on the financial condition of major borrowers, reduced concentration of the resource base by creditors and customer deposit portfolio by major depositors,as well as the implementation of the main directions of the Bank’s development strategy. A negative impact on the rating of bank deposit reliability may have the following: realization of certain financial risks, in particular, deterioration of the Bank’s solvency (liquidity), growth of credit risks due to deterioration in servicing of the granted loans, increased vulnerability of the Bank to market risks, reduced performance indicators, as well as the deterioration of the political and economic situation in the country.

In order to carry out the analytical research the materials provided by "MOTOR BANK" PJSC were used, including the annual financial statements for 2011-2014 and January - September 2015, other necessary internal information as well as the information from public sources, which the Rating agency considers reliable.

Finance department
For more information please contact:
Press service of IBI-Rating
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