OREANDA-NEWS. December 29, 2012. The change in outlook from “stable” to “positive” reflects the launch of a new development strategy aimed at increasing the effectiveness and diversification of the Bank’s business, along with a noticeable decline in the volume of problem loans and improved management practices.

The rating itself is based on the capacity of the Bank’s owners to provide support, a stable circle of larger corporate clients in the oil and construction industries, a steady liquidity position and professional management.

Constraining factors include a lack of transparency with respect to the Bank’s beneficiary owners, a business that remains more than usually concentrated by individual client, and risks associated with the introduction of a new development strategy.

M Bank (Mosstroyekonombank) is a mid-sized Moscow credit organisation that was previously a construction industry specialist; the municipal authorities historically held a minority stake but sold out to majority shareholders in March 2012 as the city disposed of non-profile assets. A controlling interest is held by finance and construction companies whose beneficiary owners were at one time affiliated with the BIN group. The Bank has a modest branch network with a limited geographic reach. Market positions are solid and it can draw on established business ties across the Moscow construction sector. A new development strategy focused on retail and SME services (mainly for clients in Moscow and the surrounding region) was launched in early 2012.