IBI-Rating has affirmed the credit rating of JSC «BTA BANK» at uaBBB- grade

IBI-Rating informs on affirming of the credit rating of JSC «BTA BANK» at the level of uaBBB– with a «negative» outlook and CreditWatch listing. The bank deposit reliability rating is affirmed at the level of «5» (excellent reliability).

JSC «BTA BANK» has been operating in the banking services market since 1992 and belongs to the group of banks with private capital in accordance with the criteria for grouping banks. The sole shareholder of the banking institution is JSC «BTA BANK» (Kazakhstan), and the ultimate beneficiary is a citizen of the Republic of Kazakhstan - Rakishev Kenes. Currently, the Bank is actively looking for new investors. On March 2, 2023, the Antimonopoly Committee of Ukraine granted permission for the acquisition of more than 50% of the shares of JSC «BTA BANK» to a citizen of Georgia, Rati Tchelidze. As of the date of Bank's ratings updating, the procedure for agreeing the change of the institution's owner by the National Bank is ongoing.

During the analyzed period, JSC «BTA BANK» complied with most of the NBU's economic norms, except for the regulatory capital (R1), and had a significant margin of deviation for the majority of them. As of July 1, 2023, the regulatory capital amounted to UAH 162.7 million, which is below the required minimum of UAH 200 million, due to the bank's long-term loss-making activities over several years. Considering the low share of the loan portfolio in assets and the priority of investing in risk-free assets (deposit certificates and government bonds), the adequacy ratio of regulatory capital as of July 1, 2023, was above 105.2% (with a required minimum of 10%). The volume of highly liquid assets of JSC BTA BANK for 6 months of 2023 remained at 81.5% of total assets. Highly liquid assets mainly include NBU deposit certificates, investments in government bonds, funds on correspondent accounts in other banks, and cash. Despite the increase in income amidst cost reduction, the performance of JSC «BTA BANK» during the first half of 2023 remained unprofitable. The loss for the 6 months of 2023 amounted to 18.6 million UAH.

Credit rating affirmation with negative outlook is due to decrease of regulatory capital below the minimum required level, considering the bank's prolonged unprofitable activity; uncertainty regarding the bank's future development, limited sources of operating income, and low efficiency indicators that lead to losses. However, the bank's ratings are supported by high liquidity indicators. Additionally, the ratings are influenced by the prolonged military actions on the territory of Ukraine due to the aggression from the Russian Federation, as well as worsening business conditions and uncertainty regarding economic development prospects.

In order to conduct the analytical research the materials provided by JSC «BTA BANK» have been used, including: annual financial statements for 2020-2022 years and 6 months of 2023, 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