NRA assigns A- individual creditworthiness rating to Solidarnost Bank

National Rating Agency (NRA) has issued an individual creditworthiness rating of A- (high creditworthiness, level 3) to Solidarnost Bank, the agency said in a press release.

Solidarnost Bank is a mid-cap bank with equity capital, taking into account subordinated loans, equal to around Rub 1 bln, while its capital adequacy ratios are not high, but sufficient to cover the bank’s risky assets, NRA said in the press release. “The charter capital’s upsizing the bank mulls in early 2009 will bolster capitalization indicators. The structure of the bank’s assets is diversified by instruments and the bank conducts aggressive operations on the securities and corporate lending markets. The quality of the credit portfolio, in line with the lender’s financials, is good, the credit portfolio is well-diversified by sectors represented by its borrowers and terms of credits granted, loans are provided against collateral and reserves are sufficient, with no substantial losses under credits. Third party transactions are quite a few” — the agency pointed out.

The rating level takes into account many years of the bank’s operations, positive credit history, strong corporate governance standards and a strong likelihood of support on the part of its shareholders. Main sources of funding for the bank’s assets are balances held on clients’ corporate accounts and its own promissory notes. An increase in funding sources is adequate to that in risk components. The quality of assets is good and the key task is to maintain high liquidity and creditworthiness, while the lending institution invests available funds in first-class securities from the CBR Lombard List. Solidarnost Bank’s activities generate profit, ROA and ROA ratios are positive, NRA professionals are confident.