OREANDA-NEWS. November 09, 2012. Standard & Poor’s Ratings Services affirmed ratings for V.Bank at "ВВ-" international scale and "ruАА-" Russian national scale within the framework of credit ratings annual review. Short-term credit rating of the bank was confirmed at "В". The outlook remains “Stable”, reported the press-centre of Bank Vozrozhdenie.

The ratings agency outlined such advantages of Bank Vozrozhdenie as well-established business position in Moscow and the Moscow region, sufficient liquidity level and an adequate funding structure, as well as conservative approach to provisioning. The ratings agency’s analysts point out professionalism of the bank’s management team who follow a cautious and risk-averse approach to the banking business, which explains the bank’s generally stable and good performance through the cycle.

“Bank Vozrozhdenie has its own market niche and core franchise, which proved stable during the financial stress of 2008-2009. The bank managed to remain profitable although costs of credit risk jumped, as was the case for the entire system, — notices Elena Romanova, analyst of Standard & Poor’s Ratings Services,. — We expect the bank’s profitability to improve in the future, due to its plan to boost its franchise in high-yielding loans to small and midsize enterprises (SME), and optimization of operating expenses”, — Elena Romanova added.

“We are glad that Standard & Poor’s analysts highly valued such competitive advantages of the bank as reliable sourcing base and healthy earnings structure. 95% of the revenues come from interest income, fees and commissions, while the share of non-interest income remains one of the highest among Russian banks. We traditionally put special emphasis on risk management, while maintaining matched currency and maturity balance sheet structure. Low dependence on market borrowings and the Central Bank’s funding provide sustainable resource base amid macroeconomic instability. Otherwise, the subordinated loan, got in July, 2012, will strengthen the bank’s liquidity, in the long-term prospective”, — Andrey Shalimov, Deputy Chairman of the Management Board, commented.

The stable outlook on Bank Vozrozhdenie reflects Standard & Poor’s Ratings Services’ view that the bank’s asset quality and profitability will remain broadly stable. The ratings may be negatively influenced by a decrease in the bank’s capitalization or a sudden deterioration in the credit portfolio quality and an increase in single-party loan concentrations. The capital under pressure and relatively high operational risks, inherent in Russia, create a deterrent for the bank’s ratings that, however, may be increased in the event of significant improvements in financial position of V.Bank and capital adequacy rising due to capital injections or improved internal capital generation.