The international agency Moody's has lowered the basic credit rating (BCA) and the rating of Promsvyazbank's subordinated debt to the level of "highly speculative". In Moody `s explain their actions by the fact that the indicators of solvency of PSB will remain weak for at least a year, as well as a high level of troubled assets of the bank.
Yesterday Moody`s confirmed long-term ratings of deposits in foreign and national currencies of Promsvyazbank at Ba3 level (risky liabilities with speculative features), leaving a negative outlook for them. At the same time, the agency lowered the basic credit rating of the bank from B1 to B2 (highly speculative), as well as the rating of subordinated debt from B2 / B3 to B3 / Caa1 (highly speculative and risky). The issuer's long-term ratings in national and foreign currencies of the holding company Promsvyaz Capital B.V., registered in the Netherlands. were deteriorated to B3 with B2. The decrease in the basic credit rating to B2 from B1 is due to Moody's expectations that PSB's solvency indicators will remain weak over the next 12-18 months, the agency said.
Promsvyazbank is a systemically important bank. As a result of the first half of 2017, he took the tenth place in terms of assets (1.2 trillion rubles) in the ranking of Interfax. The main shareholders of the bank are Alexei and Dmitry Ananyev. Currently, Promsvyazbank is preparing to merge with Bank Vozrozhdenie, announced in mid-September.
In Moody `s also point to a large amount of impaired assets of Promsvyazbank. "Problem loans, including devaluated corporate and non-performing retail, accounted for 19% of the total loan portfolio as of June 30, 2017 (19.8% in 2015 and 13.3% in 2014)," Moody `s, stressing that this level is significantly above average. The coverage of bad loans with provisions for loan losses remained at a low level (45%), which is lower than the system average (70%). If problems worsen, it will put pressure on the bank's profitability and capital. Promsvyazbank was not surprised by the actions of the rating agency. "The final assessment of the bank's credit rating agency has remained unchanged since 2016. This is due to the credit of Transaero Airlines in 2015, "the press service of Promsvyazbank reported.
At the same time, analysts at Moody`s noted that the liquidity and funding of Promsvyazbank is still stable and resistant to the negative information that surrounds the bank in recent months. To solve potential problems, the bank maintains a high liquidity buffer, exceeding 20% of its assets, Moody's points out. "The liquidity buffer at the bank is 254 billion rubles. - The maximum for the past 45 days," - said earlier the press service of Promsvyazbank.
The occasion for numerous rumors around large private banks, including Promsvyazbank, was a letter sent by an employee of Alfa Capital, Sergei Gavrilov (see "Kommersant" on August 17). He said that in relation to FC Otkritie, Binbank, Promsvyazbank and Moscow Credit Bank (MCB), the regulator "may be taken decisions this fall." Then all the listed banks categorically denied this information. However, in late August, the Central Bank decided to reorganize the bank "FC Otkritie", a similar decision on Binbank was made public on September 21. Promsvyazbank and IBC insist that there are no problems. However, Kommersant sources close to the regulator and Promsvyazbank argued that its key owners, Alexei and Dmitry Ananyev, are informally discussing with the Central Bank its future fate.
Moody's ratings are primarily informative, and their reduction will not lead to any restrictions, but will signal the market. Since July 13, in connection with the law on rating activities, the Central Bank has ceased to take into account the ratings of international agencies for regulatory purposes. They were supposed to create subsidiaries in Russia and pass accreditation, but this did not happen. Nevertheless, assessments of the leading players in the world rating market are an image that can not be taken away by any local laws, experts say.