Russian rating agency RAEX (Expert RA) has upgraded J&T Bank's creditworthiness rating to A+ (the very high level of creditworthiness, Sublevel 3), with a stable outlook. Previously the bank was rated at A (the high level of creditworthiness, Sublevel 1), with a stable outlook.
The bank's rating was upgraded, first and foremost, after the bank's current shareholders upsized its charter capital by Rub 5.6 bln in May. "These funds will allow the bank to roll out active operations without accepting unreasonable risks," RAEX director for banking ratings Stanislav Volkov commented. Thanks to the increased equity, the lender's capital adequacy ratio reached a very high level (N1.0 equaled 78.4% as of June 1), and in the future the agency expects this ratio to fall, but still with a considerable cushion compared to the minimum threshold.
Furthermore, the rating is supported by the bank's well-balanced assets and liabilities in the short term and for over 12 months, and also low corporate NPLs (1.8% of the portfolio of loans granted to businesses and individual entrepreneurs as of June 1).
The bank's rating is constrained by the rising portion of loans of the third quality category (from 4.1% of the aggregate credit portfolio as of June 1, 2014 to 21.4% as of June 1, 2015), moderately high dependence of liabilities on the funds of the largest creditor (6% of gross liabilities as of June 1), and also high concentration of credit risks on the companies engaged in real estate and lease activities (loans issued to these companies equaled 35.5% of the corporate credit portfolio, or 8.9% of the bank's assets as of June 1).
