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IBI-Rating has affirmed the rating of bank deposit reliability of "CREDITWEST BANK" PJSC at 5 grade

06.01.2016
IBI-Rating informs on the affirmation of the rating of bank deposit reliability of "CREDITWEST BANK" PJSC at 5 grade (excellent reliability).

Rating of bank deposit reliability at grade 5 indicates that the financial institution is reliable, pays its obligations timely within the requirements established by the current legislation of Ukraine, including those of the National Bank of Ukraine, and has a good reputation. The likelihood of problems with a timely return of deposits is low, as the financial institution is not highly sensitive to the impact of external and internal factors. The impact assessment of external factors does not apply to the situations involving force majeure circumstances.

The affirmation of the rating grade of "CREDITWEST BANK" PJSC is due to its maintaining of the high level of capitalization. It should also be noted that the Bank meets its obligations to creditors in a timely manner and in full. The volume of highly liquid assets, which consist mainly of balances on correspondent accounts with other banks, is at a high level. The actual values of liquidity ratios significantly exceed the minimum allowable values set by the NBU. However, the existing dependence of the Bank on its major corporate customers both in the resource base, and in the structure of assets, may put pressure on the Bank's liquidity and increase its vulnerability to certain financial risks. The Rating agency notes good quality of the Bank's assets, however, during the analyzed period, the Bank retained dependence on the financial condition of a small number of borrowers, which increases the Bank vulnerability to credit risk. Also, certain financial indicators may be negatively impacted by the available significant volume of foreign currency loans and the absence of foreign exchange earnings of certain borrowers. In addition, the impact on sensitivity to financial risks may increase as a result of persistence of adverse trends in the economy and reduced solvency of borrowers. The main component of the resource base are amounts due to customers, which are mainly formed by corporate customers on demand, and which the Bank places in profitable assets, allowing it to increase the amount of net interest income. However, such a liability structure leads to the concentration of the Bank's resource base by major creditors, which constrains the financial flexibility and increases the Bank's vulnerability to liquidity risk. According to the results of 11 months of 2015, the Bank's operations remained profitable, and performance indicators of "CREDITWEST BANK" PJSC were sufficient.

IBI-Rating does not yet see the factors that may lead to upgrading of the Bank's grade of the rating of bank deposit reliability in the short run. Downgrading of the rating of bank deposit reliability rating is possible in the event of worsening of the Bank’s solvency (liquidity); growth of credit risks because of deterioration of servicing of the granted loans and increased vulnerability of the Bank to market risks, decreased performance indicators and loss-making operations as well as deterioration of the political and economic situation in the country.

In order to perform the analytical research the materials provided by "CREDITWEST BANK" PJSC were used, including the annual financial statements for 2011-2014 and 9 months of 2015, target performance indicators for 2016, other necessary internal information, as well as the information from the public sources, which the Rating agency considers reliable.

Finance department
For more information please contact:
Press service of IBI-Rating
(044) 362-90-84
press(at)ibi.com.ua