OREANDA-NEWS.National Rating Agency has affirmed its credit rating on Moskommertsbank CB (MKB) at 'A+'. The outlook assigned to the rating is negative.

The rating is supported by MKB's adequate equity and its affiliation with one of the largest Kazakhstan-based banking groups. Other positive rating factors include the high level of commitment and support on the part of MKB's owner, Kazkommertsbank JSC (KKB), as well as MKB's well-developed corporate governance and risk management systems, benefiting from KKB's ability to integrate cross-organizational business processes into its Russia-based subsidiary.

The rating is constrained by the bank's low-quality loan portfolio, limited business activity and low profitability. The negative outlook reflects MKB's business stagnation in 2014, customer base contraction and the remaining high proportion of nonperforming loans (NPL) that have not demonstrated much improvement in performance over the year under review. We expect the bank's asset quality to deteriorate in 2015 as the macroeconomic environment becomes more severe. The situation is especially alarming due to the high proportion of foreign currency-denominated mortgage loans in the MKB's loan book. At the same time, we may consider revising the negative rating