BRAMA, Dec 15, 2005, 1:00 pm ET
Press release
Fitch Affirms Ukraine's Ukreximbank at 'BB-'
Fitch Ratings-London/Moscow-15 December 2005: Fitch Ratings has today affirmed The State Export-Import Bank of Ukraine ("Ukreximbank") ratings at Long-term 'BB-' (BB minus), Short-term 'B', Individual 'D/E' and Support '3'. The Outlook for the Long-term rating remains Positive.
The Long-term, Short-term and Support ratings reflect the moderate potential for support from the Ukrainian state (rated Long-term 'BB-'(BB minus)/Positive) should Ukreximbank encounter any financial difficulty. Ukreximbank received liquidity and regulatory support from the National Bank of Ukraine ("NBU") in the 1990s after it encountered asset quality problems due to several large government-directed or -related loans. In addition, comfort letters from the government of Ukraine have been published in the offering circulars of the bank's public debt issues.
The Individual rating takes into account the risks associated with the significant concentration in the bank's loan book and potentially vulnerable liquidity. However, the rating also considers the improvement in its asset quality and the development of its business.
The Positive Outlook on the Long-term rating reflects that on the Ukrainian sovereign rating. An upgrade (downgrade) of the Long-term rating of the sovereign would be expected to lead to an upgrade (downgrade) of the bank's Long-term rating.
Upside to the Individual rating might result from an increase in capitalisation, a decrease in loan concentrations, as well as improvements in liquidity and the operating environment. Downside to the Individual rating could result from deterioration in capitalisation or a worsening of asset quality.
Ukreximbank was founded in 1992 on the basis of the Ukrainian branch of Vnesheconombank of the USSR. In terms of assets, it was the sixth-largest Ukrainian bank at end-Q305. Ukreximbank has always been 100%-owned by the Ukrainian state. It is the only Ukrainian bank that acts as the government's financial agent in raising and servicing state-guaranteed international loans to domestic corporates. In addition, Ukreximbank focuses on corporate (in particular international business and export/import oriented customers) and retail banking.
Contact: Vladlen Kuznetsov, Moscow, Tel: +7 095 956 9901, James Watson, +7 095 956 9901.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
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