RIA NOVOSTI. International rating agency Moody’s Investors Service has assigned B3 long- and short-term local and foreign currency deposit ratings to Metallurgical Commercial Bank (MCB). The outlook on all ratings is stable, the agency said in a press release. Also, Moody’s also gave to MCB E+ bank financial strength rating (“BFSR”), with a stable outlook.
According to the rating agency, the lending institution’s ratings are heavily reliant on Severstal, a leading metal maker in Russia. At the same time, the lender’s ratings are constrained by the low visibility on the market, and also a deteriorating operating environment that “will stress the bank’s currently modest financial performance”.
As the agency emphasized, MCB is ultimately under control of Severstal and to a large extent depends on its funding. For the record, in November 2007 the lending institution sold its 53.57% stake to limited liability company Capital that is affiliated with the bank’s beneficial owner Alexey Mordashov.
As the rating agency reported, MCB has adopted a strategy geared towards diversifying its business profile by expanding regional coverage in Russia and phasing in retail products. And although the bank’s diversification program will slow down due to the deteriorating operating environment, the accumulated capital and liquidity cushion, as the agency sees it, will to a certain extent mitigate the current risks.
Metallurgical Commercial Bank was established on November 22, 1990 on the basis of the metallurgical division of Industrial Construction Bank of the USSR.
