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

04.01.2016
IBI-Rating informs on the affirmation of the rating of bank deposit reliability of "BANK MIKHAILOVSKY" PJSC at grade «4+» (high reliability).

Rating of bank deposit reliability at grade 4+ 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. The problems with a timely return of deposits are unlikely to arise, 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 affirmation of grade rating is due to the Bank’s maintaining of a sufficient level of capitalization. Its capital provides partial coverage of credit and investment risks. "BANK MIKHAILOVSKY" PJSC meets its obligations to creditors in a timely manner and in full. The actual values of liquidity ratios are at a sufficient level. At the same time, the realization of credit and market risks may also put pressure on the Banks' liquidity. It should be noted that in the period under review a certain deterioration in asset quality was observed, which was expressed in the increasing number of overdue debts, but their share in the customer loan portfolio remained low. However, there is dependence of the Bank on the financial condition of its major borrowers, which increases the Bank’s vulnerability to credit risk. Also, 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 sources of asset financing are amounts due to customers, including those of private individuals, which, given the present situation in the country, contains a potential threat to deterioration of liquidity due to decreasing confidence of the population in the banking system.

Based on the results of 11 months of 2015, the Bank's operations were profitable, but its performance indicators declined slightly.

A positive impact on the rating of bank deposit reliability may have, as follows: reduced dependence on the financial condition of major borrowers, reduced concentration of the resource base by creditors, as well as implementation of the main directions of the Bank’s development strategy. A negative impact on the rating of bank deposit reliability may have, as follows: deterioration of the Bank’s solvency (liquidity), realization of credit risk due to worsened quality of the granted loans, the Bank’s increased vulnerability to market risks, 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 "BANK MIKHAILOVSKY" PJSC were used, including the annual financial statements for 2013-2014 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