London, 10 December 2020 -- Moody's Investors Service ("Moody's") today upgraded
the long-term foreign currency bank deposit ratings of 18 banks
in several countries of the Commonwealth of Independent States (CIS) region,
namely, in Armenia, Belarus, Tajikistan, Ukraine
and Uzbekistan.
The rating actions are driven by changes in the local currency (LC) and
foreign currency (FC) country ceilings applied to the jurisdictions of
the banks following the publication of Moody's updated Country Ceilings
Methodology on 7 December 2020. This methodology is available at
this link: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1225594.
Today's rating actions cover: Ameriabank CJSC, Ardshinbank
CJSC, BPS-Sberbank, OJSC Bank Eskhata, Pivdennyi
Bank, JSCB, Privatbank, Raiffeisen Bank Aval,
Savings Bank of Ukraine, Sberbank PJSC, Ukreximbank,
TASCOMBANK JSC, Bank Vostok PJSC, Agrobank, Aloqabank
JSC, Asaka Bank, Ipoteka Bank, National Bank of Uzbekistan
and JSCB Tenge Bank.
All other ratings and assessments of the banks are unaffected by today's
actions.
Please click on this link https://www.moodys.com/viewresearchdoc.aspx?docid=PBC_ARFTL436955
for the List of Affected Credit Ratings. This list is an integral
part of this Press Release and identifies each affected issuer.
RATINGS RATIONALE
Today's rating actions on the 18 banks are driven by changes in
country ceilings under Moody's updated country ceilings methodology.
Country ceilings indicate the highest rating level that can generally
be assigned to the financially strongest obligations of issuers domiciled
in a country.
The updated ceilings methodology has unified deposit ceilings and the
typically higher debt ceilings, whereby LC and FC country ceilings
no longer distinguish between deposit and debt. These changes reflect
Moody's view that the risks that affect access to bank deposits
are not materially different from those that affect the ability of banks
and non-banks to service their debt obligations.
FOREIGN CURRENCY CEILINGS
As a result of the methodology change, FC ceilings as applied to
FC deposits were raised in Armenia, Belarus, Tajikistan,
Ukraine and Uzbekistan, resulting in upgrades of FC deposits ratings
of 18 banks.
OUTLOOKS
The outlooks on the long-term foreign currency deposit ratings
of two banks, Ameriabank CJSC and Ardshinbank CJSC, have been
changed to negative from stable.
The outlooks on the long-term foreign currency deposit ratings
for the other 16 banks affected by today's rating actions were maintained.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
In Armenia
Ratings upgrades of Armenian banks (Ameriabank CJSC and Ardshinbank CJSC)
are unlikely in the next 12 to 18 months given the unfavorable operating
conditions in the country.
The affected banks' deposit and debt ratings could be downgraded if their
solvency or liquidity were to deteriorate materially amid further weakening
of the operating conditions.
In Belarus
BPS-Sberbank's ratings could be upgraded in the event of improvements
in the Belarusian macroeconomic environment, leading to an upgrade
of the sovereign rating and country ceilings. However, Moody's
considers this to be unlikely, given the increased risks related
to the coronavirus outbreak and domestic political instability.
A significant deterioration of BPS-Sberbank's liquidity or capital
position would result in a downgrade of the bank's Baseline Credit Assessment
(BCA). The bank's long-term deposit ratings could be downgraded
in the event of a severe deterioration of its standalone credit profile
or restrictions on customers' payments.
In Tajikistan
OJSC Bank Eskhata's long-term ratings' upgrade is unlikely in the
next 12 to 18 months given the negative outlook and the unfavorable operating
landscape. However, the outlook could be returned to stable
if the bank proves to be resilient and operating pressures ease.
The bank's deposit ratings could be downgraded should the rating of the
Government of Tajikistan (currently B3 negative) be downgraded or if the
current economic turmoil results in higher credit losses eroding the bank's
capital.
In Ukraine
For the majority of the affected banks (Bank Vostok PJSC, Pivdennyi
Bank, JSCB, Privatbank, Raiffeisen Bank Aval,
Savings Bank of Ukraine, Sberbank PJSC, TASCOMBANK JSC and
Ukreximbank), deposit or debt ratings are in line with that of the
Government of Ukraine (currently B3 stable), therefore higher ratings
are unlikely in the absence of an upgrade of the sovereign rating.
At the same time, the affected banks' ratings or BCAs could be downgraded
if their financial fundamentals, notably asset quality, capitalisation
and profitability were to deteriorate materially.
In Uzbekistan
The deposit ratings of the affected banks (Agrobank, Aloqabank JSC,
Asaka Bank, Ipoteka Bank, JSCB Tenge Bank and National Bank
of Uzbekistan) are in line with that of the Government of Uzbekistan (currently
B1 stable), making positive rating actions unlikely in the absence
of a higher sovereign rating. At the same time, the affected
banks' ratings or BCAs could be downgraded if their financial fundamentals,
notably asset quality, capitalisation and profitability were to
deteriorate materially.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Banks Methodology
published in November 2019 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1147865.
Alternatively, please see the Rating Methodologies page on www.moodys.com
for a copy of this methodology.
REGULATORY DISCLOSURES
The List of Affected Credit Ratings announced here are a mix of solicited
and unsolicited credit ratings. Additionally, the List of
Affected Credit Ratings includes additional disclosures that vary with
regard to some of the ratings. Please click on this link https://www.moodys.com/viewresearchdoc.aspx?docid=PBC_ARFTL436955
for the List of Affected Credit Ratings. This list is an integral
part of this Press Release and provides, for each of the credit
ratings covered, Moody's disclosures on the following items:
• Endorsement
• Rating Solicitation
• Issuer Participation
• Participation: Access to Management
• Participation: Access to Internal Documents
• Disclosure to Rated Entity
• Lead Analyst
• Releasing Office
For further specification of Moody's key rating assumptions and
sensitivity analysis, see the sections Methodology Assumptions and
Sensitivity to Assumptions in the disclosure form. Moody's
Rating Symbols and Definitions can be found at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004.
For ratings issued on a program, series, category/class of
debt or security this announcement provides certain regulatory disclosures
in relation to each rating of a subsequently issued bond or note of the
same series, category/class of debt, security or pursuant
to a program for which the ratings are derived exclusively from existing
ratings in accordance with Moody's rating practices. For ratings
issued on a support provider, this announcement provides certain
regulatory disclosures in relation to the credit rating action on the
support provider and in relation to each particular credit rating action
for securities that derive their credit ratings from the support provider's
credit rating. For provisional ratings, this announcement
provides certain regulatory disclosures in relation to the provisional
rating assigned, and in relation to a definitive rating that may
be assigned subsequent to the final issuance of the debt, in each
case where the transaction structure and terms have not changed prior
to the assignment of the definitive rating in a manner that would have
affected the rating. For further information please see the ratings
tab on the issuer/entity page for the respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this credit rating action,
and whose ratings may change as a result of this credit rating action,
the associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
Moody's general principles for assessing environmental, social
and governance (ESG) risks in our credit analysis can be found at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1133569.
The below contact information is provided for information purposes only.
Please see the ratings tab of the issuer page at www.moodys.com,
for each of the ratings covered, Moody's disclosures on the
lead rating analyst and the Moody's legal entity that has issued
the ratings.
The person who approved BPS-Sberbank, Bank Vostok PJSC,
Pivdennyi Bank, JSCB, Privatbank, Raiffeisen Bank Aval,
Savings Bank of Ukraine, Sberbank PJSC, TASCOMBANK JSC and
Ukreximbank credit ratings is Yaroslav Sovgyra, CFA, Associate
Managing Director, Financial Institutions Group, JOURNALISTS:
44 20 7772 5456, Client Service: 44 20 7772 5454. The
person who approved Ameriabank CJSC, Ardshinbank CJSC, OJSC
Bank Eskhata, Agrobank, Aloqabank JSC, Asaka Bank,
Ipoteka Bank, JSCB Tenge Bank and National Bank of Uzbekistan credit
ratings is Nicholas Hill, MD - Banking, Financial Institutions
Group, JOURNALISTS: 44 20 7772 5456, Client Service:
44 20 7772 5454.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Semyon Isakov
Vice President - Senior Analyst
Financial Institutions Group
Moody's Investors Service Limited, Russian Branch
7th floor, Four Winds Plaza
21 1st Tverskaya-Yamskaya St.
Moscow 125047
Russia
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Yaroslav Sovgyra, CFA
Associate Managing Director
Financial Institutions Group
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Releasing Office:
Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
