OREANDA-NEWS. On 04 July 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it downgraded to uaBB- (uaBB minus) from uaBB+ (uaBB plus) the credit ratings assigned to Donetsk-based Bank Familnyi LLC (`bank`) and its issue of registered coupon bonds (series A) for the amount of UAH25m with 2-year original maturity. The outlook on both ratings is stable. To revise the rating Credit-Rating considered bank`s financial statements for 2004-2007 and 1Q2008 as well as its other inside information.

An obligor or a debt liability with uaBB credit rating is characterized with the LOWER THAN SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is strongly affected by adverse changes in commercial, financial and economic conditions. A plus "+" and a minus "-" signs indicate intermediary categories compared to the standard categories (grades).

Stable outlook indicates that there are no anticipated reasons to change the rating in the course of the year.

Factors maintaining the credit rating

A sufficient diversification of Bank`s loan portfolio by primary borrowers.

A sufficient level of securitization of active operations (30.3%) and of credit risks (44.6%) as at Apr. 1, 2008 with the Bank`s equity.

Factors constraining the credit rating

A significantly eroded quality of Bank`s loan portfolio.

High dependency of Bank`s resource base upon primary lenders, which tightens Bank`s financial flexibility and raises the liquidity risks.

Bank`s assets and liabilities are balanced insufficiently by their due terms.

Detrimental performance of Bank`s branch network, which is to entail cut in the number of outlets.

Risks of loss of Bank`s market position, which may be caused by Bank`s limited capacity for customer attraction and by hotly competitive environment in Ukraine`s financial market.