OREANDA-NEWS. On 17 March 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine, announced that it assigned a long-term credit rating of uaBBB to UAH75m 3-year registered coupon bonds (series A) to be issued by Ivano-Frankivsk-based Plus Bank OJSC (`Bank`). In the course of analysis Credit-Rating considered Bank`s financial statements for 2002-2007 and its other information.

An obligor or a debt liability with uaBBB credit rating is characterized with the SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is affected by adverse changes in commercial, financial and economic conditions.

Factors maintaining the credit rating

The Bank may get necessary backing in case of need from its primary shareholder, the Poland-domiciled Getin Holding financial group, which incorporates two banks, an insurance company, and several financial and leasing companies.

Low specific gravity of overdue and doubtful loans in Bank`s customer loan portfolio, namely 0.57 percent as of Jan. 1, 2008.

The diversification of the Bank`s loan portfolio has improved significantly, in fact the loans granted for 20 biggest borrowers account for 19 percent of the customer loan portfolio, or 21 percent of the Tier I capital. The Bank`s resource base has also enhanced noticeably: as of Jan. 1, 2008 the funds of 20 biggest lenders make up 15.4 percent of Bank`s liabilities.

Factors constraining the credit rating

Bank`s ambitious expansion plans, which envisage risky credit policy, namely cash (blank) lending, accompanied by almost 25x rise in assets and 9.5x in authorized stock occurred in the past 3 years.

The Bank`s management system requires further enhancements.

Bank`s underdeveloped branch network and card segment, which may hamper Bank`s achievement of its strategic goals provided that big systemic banks would further augment their market positions.