Uzbekistan-based Ravnaq-bank asssigned 'CCC/C' ratings; Outlook Positive
Azerbaijan, Baku, Dec. 21 / Trend V. Zhavoronkova /
Standard & Poor's Ratings Services assigned its 'CCC' long-term and 'C' short-term counterparty credit ratings to Uzbekistan-based Ravnaq-bank. The outlook is positive.
The ratings reflect the 'b+' anchor for a bank operating primarily in Uzbekistan, as well as Ravnaq-bank's "weak" business position, "strong" capital and earnings, "weak" risk position, "below average" funding, and "adequate" liquidity, as our criteria define these terms. The stand-alone credit profile (SACP) is 'ccc'.
The positive outlook on Ravnaq-bank reflects our view that the bank is likely to improve its business position since the ban on active operations was lifted in November 2012 and after retail deposit collection starts in February 2013.
Obtaining a foreign currency license may also materially support the bank's earning capacity. In addition, we expect the bank to maintain strong capitalization and adequate liquidity.
"We might consider raising the rating if the bank improves its business diversity and quality of its revenue base, while continuing to gradually advance its risk management and operational capacity. We assume business expansion will not substantially deteriorate the strong capitalization," the message said.
"We could consider a negative rating action if we saw no material improvements in the bank's business development in the near future. This could happen if the bank failed to realize its strategy of expanding its geographic coverage, customer base, and range of products and services, or did not obtain a foreign currency license," the message said.
An additional source of pressure on the bank's creditworthiness could come from a decline in liquidity or solvency, with the bank's risk-adjusted capital ratio falling below 10%.