Uzbekistan, Tashkent, July 14 / Trend D. Azizov /
Standard & Poor's international rating agency affirmed the ratings of the Uzbek Industrial Construction Bank (Uzpromstroybank) at 'B + / B with stable forecast on Friday, the agency said on Friday.
It was earlier reported that in December 2011 S & P upgraded Uzpromstroybank's long-term counterparty rating from "B" to "B +" with a positive outlook. The short-term ratings of banks maintained at the level "B".
"We believe that the capital injections made in 2011 and expected in 2012-2013, as well as the amount of self-generated capital are sufficient to support the planned growth of Uzpromstroybank's assets, the agency said.
Uzpromstroybank's share capital increased by 20 percent. The Uzbek government is the main shareholder of the bank. It intends to increase the capital of the bank's Tier 1 by 152 billion soums - up to 300 billion soums, by using undisposed profit in 2012-2013.
According to the agency, the use of undisposed profit and capital increase will allow "Uzpromstroybank" to increase assets by 30 percent per year and will improve its capital ratios.
In this regard, the agency changed the assessment of Uzpromstroybank's capital ratios and profitability from weak to moderate.
According to the agency, "stable" outlook reflects the high economic risks faced by the Uzbek banks, as well as the expectations that "Uzpromstroybank" will continue to be owned and receive state support.
"We expect that the financial profile and business profile of the bank in the next 12-24 months will not change," a statement said.
"However, proceeding from our assessment of the Uzbek government's creditworthiness, which is based on available information, we will not add additional levels to the bank's ratings," a statement said.
S & P analysts believe that Uzbekistan's creditworthiness has a moderating influence on the ratings of banks. The bank's ratings are unlikely to increase without increasing Uzbekistan's creditworthiness. Ratings could be lowered if the conditions for conducting the banking activity will worsen. The deterioration in asset quality may be stipulated by the uncontrolled growth of granted loans or the inability of the state to maintain the basic sectors of the economy and industry.
"Uzpromstroybank" is the oldest bank in Uzbekistan. It was established in 1922 and re-registered in 1991. The main activity is to lend the enterprises of the strategic sectors of industry. The structure of the bank includes 45 branches, 176 savings banks, 65 mini-banks located in all regions of the republic, a representative office in Moscow.
In 2011, the bank's assets increased by 79.4 percent - to 3.46 trillion soums, credit portfolio - by 63.6 percent to 2.23 trillion soums, the liabilities - by 85.4 percent to 3.24 trillion soums, equity - by 22.7 percent to 224.95 billion soums, taking into account the joint stock capital worth 148.005 billion soums.
The official exchange rate is 1.892.59 soums /$1 on July 13.