Moody’s assigned Ba1/ Ba3/ NP/D to VTB Bank (Armenia)

Moody’s assigned Ba1/ Ba3/ NP/D to VTB Bank (Armenia)

YEREVAN, August 15. /ARKA/.  Moody's Investors Service has assigned the following ratings to VTB Bank (Armenia): local currency deposit rating of Ba1, foreign currency deposit rating of Ba3, bank financial strength of D- (equivalent to a ba3 baseline credit assessment [BCA]), and Not-Prime short-term deposit ratings.

The bank's long-term global local currency deposit rating carries a negative outlook, the long-term global foreign currency deposit rating and the BFSR carry a stable outlook, the agency reported.

The bank's Ba1 long-term local currency deposit rating incorporates the rating agency's assessment of a high probability of parental support from Russia-based Bank VTB JSC (deposits Baa2 negative; BFSR D- negative/BCA ba3). As a result, the bank's deposit ratings receive two notches of uplift from its ba3 BCA, according to the report.

The bank's standalone D- BFSR is supported by the bank's (1) close integration into the VTB group, which facilitates the bank's business origination and supports its funding and liquidity profile; (2) strong franchise in the corporate and retail segments in Armenia; and (3) good financial fundamentals namely capital adequacy, profitability and efficiency. Factors constraining the bank's standalone ratings include its aggressive lending strategy in 2010-13, which could result in heavy credit losses upon seasoning, as well as high credit risk concentrations.

It is an important event for the bank, general director and head of board of VTB Bank (Armenia) Yury Gusev said. He also said the current ratings are limited to the country ceiling and can be reviewed if the celeing is upgraded.
 
Head of subsidiaries and senior vice-president of VTB Bank Mikhail Yakunin said the Armenian affiliate is offering universal services and has a wide access to the market through a broad network of offices across the country. The bank is active in economic sectors of importance to Armenia, he said.

Yakunin also expressed confidence the Moody’s ratings will facilitate further development of VTB Bank’s relations with its old and new partners in Armenia and abroad.

Bank VTB (Armenia) closed joint stock company became a member of VTB financial group in April 2004. The second biggest Russian bank, Bank VTB open joint-stock company, is now the full owner of Bank VTB (Armenia). The bank used to be among leaders of Armenian banking system on a number of basic indicators. Currently the bank has the biggest network in Armenia – 67 branch offices throughout the country.   

Assets of Bank VTB (Armenia) amounted to 312.4 billion drams as of the end of June (3.37% increase against the beginning of the year); the bank’s liabilities were 268.5bln drams (1.31% increase), capital 43.96bln drams (18% increase), loan investments about 230.3bln drams (5.25% increase). –0–

12:40 15.08.2014

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