OREANDA-NEWS. National Rating Agency has affirmed its national scale ‘A-’ credit rating on JSC TROIKA-D BANK.

The rating affirmation is driven by the bank’s good liquidity position (liquidity ratios are comfortably above minimum regulatory requirements, quick assets growth exceeds the increase in call deposits); well-balanced equity structure and good capitalization; improving key financial performance indicators, some of which (total loans, balances due to customers) grow well above market average; and the low level of nonperforming loans in the context of a considerable lending increase.

We also note the bank’s positive financial results and strong profitability metrics achieved this year (ROE = 47.7% and ROA = 9.1% on March 1, 2015). However, we cannot assess the bank’s long-term profitability and earnings capacity as strong due to the last year’s annual loss RUB406.5 million.

The rating is constrained by the bank’s poorly diversified funding base (retail deposits account for 74% of total liabilities); risks related to the loan book single-name concentration (the 20 largest exposures stood at more than 61% of the total loans on Feb. 1, 2015) and sector concentration (exposure to the real estate and construction sectors, which we believe are highly vulnerable to the current economic situation, exceeds RUB4.7 billion).