OREANDA-NEWS. On August 20, 2008 Standard & Poor’s Ratings Services assigned its “BB-/B” counterparty credit and “ruAA-” Russia national scale ratings to Bank Vozrozhdenie. The outlook is stable, reported the press-centre of Bank Vozrozhdenie.

“The ratings reflect the bank’s relatively high exposure to credit risk; moderate single-party concentrations in loans; and its high cost base“, commented Standard & Poor’s Rating Analyst Eugene Tarzimanov.

The ratings are supported by the bank’s good business profile in the Moscow region; satisfactory financial performance; good funding profile; and adequate capitalization. The ratings on Vozrozhdenie mirror its stand-alone credit quality, and do not include any uplift for extraordinary external support from its shareholders or the Russian government. With total assets of US5 billion at March 31, 2008, Vozrozhdenie ranks among the largest 30 Russian banks in assets.

“The stable outlook reflects our expectation that Vozrozhdenie will expand in line with strategy, while maintaining its commercial and financial profile. The bank’s focus on the SME segment should support margins and provide a flow of recurring revenues”, commented Mr. Tarzimanov.
A positive rating action could follow if the bank demonstrates its resilience to heavy competitive pressure by expanding its client base and keeping good margins; lowers its cost base; and maintains satisfactory capitalization. A negative pressure on ratings could materialize if capitalization falls significantly, lending concentration worsens, or the quality of the loan portfolio and earnings structure deteriorates.

"We received another international rating that will facilitate fund raising on international capital markets”, commented the member of Bank Vozrozhdenie Management Board Andrei Shalimov. “We are pleased that Standard & Poor’s has recognized the Bank’s potential on the SME market as such companies are our target segment”, said Mr. Shalimov.