OREANDA-NEWS. RusRating has raised Kuban Credit Bank’s credit rating from "A-" to “A” on the national scale, with a stable outlook.

The rating increase reflects the Bank’s steady development in the context of its chosen strategy coupled with consistently acceptable key financial indicators.

The rating is based on a stable corporate client base, strong support from the Bank’s owner, professional management, an important social function in Krasnodar region, effective strategy and stable quality indicators.

Constraining factors include dependence on retail deposits; noticeable exposure to large-scale credit risks and borrowers drawn from the construction industry; and a geographically-concentrated business.

KB Kuban Credit (OOO) is a private-sector regional bank that operates in Krasnodar region and is one of the top 100 banks in Russia by assets. The Bank is owned by entrepreneur Viktor Budarin and its core line of business is the provision of corporate loans, some of which are extended to affiliated companies. Retail activity has been developing since 2001, with an emphasis on deposits, payments and plastic cards; a mortgage loan programme was launched in 2005. The Bank has a well-established network of sub-branches in its home region and is a leading player in all main segments of the local market.

Capital is sufficient and its quality is rated favourably, but a large portion of the Bank’s own funds are immobilised by property holdings. Retail deposits are the main component of liabilities; their stability is reinforced by an established market presence and important social function in Krasnodar region. Asset quality is rated satisfactory based on analysis of client loans, which involve exposure to large-scale credit risks and affiliated parties in the residential construction industry; loan backing is acceptable and interest returns are healthy. Overall earnings performance is satisfactory. Risk sensitivity is moderate. Liquidity is sufficient.