PRIME. International rating agency Fitch affirmed its long-term Issuer Default Rating (IDR) of B+ on Kraiinvestbank, a stable outlook, the agency said in a press release.
Fitch also affirmed the bank’s short-term rating at B and long-term national scale rating of A-(rus), a stable outlook. At the same time, the agency put the lending institution’s BFSR of b- on Rating Watch Negative (RWN).
The long-term rating reflects the agency’s opinion about the bank’s limited support by the Krasnodar region’s government taking into account its moderate importance for the regional banking system, financial results and corporate governance problems.
The bank’s BFSR was placed on RWN due to the assessment by analysts of the risks associated with the bank’s growing debt.
Kraiinvestbank’s ratings could be cut if the ties between the bank and the regional government weaken. Rating upgrades are possible provided that the bank becomes more systemically important and corporate governance improves. “However, Fitch regards this unlikely in the short- and mid-term outlook," added the agency.
