OREANDA-NEWS. October 29, 2012. The decision of the Moody’s Investors Service rating agency on downgrading the Uniastrum Bank long-term deposit rating under obligations in foreign and national currency to Caa1 with a negative international outlook, as well as on downgrading of the national rating to Ba3 is first of all related to the downgrading of the parent bank rating in October 2012 and the Agency’s apprehensions regarding the potential of the Bank of Cyprus Group to render assistance to Uniastrum Bank, if necessary, reported the press-centre of Uniastrum Bank.

The rating downgrading will not affect the activities of Uniastrum Bank, because at present the resource base of the bank is diversified enough, and the Group’s investments do not exceed 20% of the Bank’s liabilities which proves the fact that the Uniastrum Bank business does not directly depend on the parent bank. At the same time, the owners of Uniastrum Bank stick to a single opinion that the funding source will be unchanged in the nearest future. Presence in Russia is still important for the Group, and, if necessary, the Group will keep supporting its subsidiary credit institution both from the equity capital and from the funding point of view.

On the basis of the 9 months 2012 results, the positive implementation of the Uniastrum Bank retail banking strategy is evident, as demonstrated by the substantial growth in the volumes of the priority lending sectors of Uniastrum Bank. During the year, the volume of disbursements of consumer loans has risen three times, Uniastrum Bank is in the top-20 banks by the loan portfolio volume in credit cards and holds a stable position in the top-10 by the SME loan portfolio size. Furthermore, the share of consumer and SME loans has grown from 21 to 27% during this year. It is also important to note the substantial quality improvement observed in the particular portfolios.

The negative 9 months 2012 financial result of the Bank according to the Russian Accounting Standards is brought about by the Bank’s resolution to take a conservative approach against certain corporate loans disbursed to finance investment projects. Without considering the extra provisions created in Q3 2012, the Bank’s profit for 9 months is Rb 295 mn, which is by 60% more than the profit for 9 months 2011.