Press Release as of 25.10.2011
OJSC Eurasian bank
AK&M Rating Agency raised credit rating of OJSC Eurasian Bank to B++ (stable outlook) as per the national scale
AK&M Rating Agency revised the current credit rating of OJSC Eurasian Bank raising it to B++ with a stable outlook as per the national scale.
The ‘B++' rating indicates that OJSC Eurasian Bank is qualified as a sufficiently reliable borrower (the highest sub-grade of the ‘B' grade). Risk of a delay in meeting liabilities is moderate, restructuring risk for a loan / part of a loan is insignificant.
The rating score is supported by the good bank liquidity ratios of the Bank, its improving resource base, an appreciable growth rate of assets and liabilities. Other indicators indicating the Bank’s revenue position (ROE, net income margin, lending profitability) also are acceptable. Net interest income has had good growth momentum. As of 10/1/2011, interest incomes were far above the related interest expenses.
One of the principal arguments for the rating score of OJSC Eurasian Bank is the rapidly developing active base (RUB 1,491 million as of 10/01/2011) and the essential growth of the Bank’s liabilities (RUB 954.5 million as of 10/01/2011). Another positive signal comes from the large loan portfolio (RUB 574 million) well-diversified across various spheres and industries.
Another thing favorable for the rating score is the high liquidity level of OJSC Eurasian Bank. Quick liquidity ratio (N2 = 181.39) and current liquidity ratio (N3 = 379.12) are at comfortable levels proving that the Bank has achieved sufficient liquidity.
The income structure of OJSC Eurasian Bank is efficient and progressive. Net interest incomes, proceeds from securities operations and operations involving foreign currencies prevail in the net income structure.
This year, the resource base of OJSC Eurasian Bank has essentially improved, its liabilities on the rise. For three quarters 2011, cumulative liabilities increased approximately 4-fold reaching RUB 954,426 thousand as of 10/1/2011. Also, funds placed by enterprises and organizations accounted for over 85% of the total amount of liabilities.
One of the risk factors for the company is the relatively small net profit for three quarters 2011 (RUB 1,290 thousand). The relatively small equity capital of the Bank (RUB 518 million) also exerts pressure on the rating score.
OJSC Eurasian Bank (reg. no. 969 as of 9/24/1992) specializes in corporate lending and consumer crediting both to legal entities and physical persons. The Bank's authorized capital as of 10/1/2011 was RUB 239,210 thousand.
OJSC Eurasian Bank is considered to be a small-sized Russian bank. With assets totaling RUB 1,491 million, the Bank ranked 625th in the amount of net assets in Russia as of the end of the third quarter 2011. As of October 1, 2011, equity capital of OJSC Eurasian Bank was RUB 518,060 thousand, net profit was RUB 1,290 thousand.
The Bank participates in the compulsory deposit insurance system.
The auditor of OJSC Eurasian Bank is CJSC Audit and Consulting Firm MIAN (license no. E 000942 as of 6/25/2002 expiring on 6/25/2012).
This press release is based on the statement of assigning a credit rating to OJSC Eurasian bank.
The rating score, along with any information and conclusions provided in this press release, only conveys our opinion on the Company's reliability and shall not be considered as advice on the purchase and sale of securities or the provision of loan facilities to the Bank.
AK&M Rating Agency will not incur any responsibility for any interpretations, inferences and consequences related to the application of results of the rating estimation procedure by any third parties.
AK&M Rating Agency is a leading independent national rating agency engaged in rating activities since 1993.
AK&M Rating Agency is accredited by the Ministry of Finance of the Russian Federation (order no. 452 as of September 17, 2010).
AK&M Ratings are recognized by the Central Bank of Russia (for providing unsecured lending facilities – Provision 323-P), Vnesheconombank (for granting subordinated loans) and SME Bank (for its program of lending to SME businesses), RUSNANO (when selecting banks to provide business banking services to project and engineering entities implementing investment projects), the MICEX (as a prerequisite for including bonds in the Corporate Bond Index / MICEX CBI and Municipal Bond Index / MICEX MBI calculation base, for listing bonds and for providing access to the MICEX+ trading mode). Pursuant to an order of Russia's Government AK&M Ratings count for approving the capitalization increase procedure for banks. Besides, AK&M Rating Agency is recognized by AHML and accredited by SRO National Securities Market Association.
CJSC Analysis, Consulting and Marketing Rating Agency
ul. Gubkina 3
Press release by: A.Y. Zolotokopov
Phone no. (495) 916-70-30, fax no.: (499) 132-69-18.