Standard & Poor’s Rated Eurasian Bank ‘B’ with Stable Outlook
07.12.2015, Almaty. Rating Agency Standard & Poor’s assigned Eurasian Bank a long-term credit rating «В» and increased its outlook from ‘Negative’ to ‘Stable’. The Bank’s short-term rating 'B' was affirmed.
Despite deterioration of asset quality, S&P recognizes that “ Eurasian Bank’s experienced management team will be able to mitigate the pressure on the bank’s financial results given the depressed economic environment and constrained system-wide funding in the Kazakh banking sector in the next 12-18 months.”
«Given the extreme volatility in the foreign currency rates and banking sector post the devaluation from August to today, the downgrade equal to half notch further recognizes the strength of the Bank’s business as well as the shareholder commitment with the recent capital increase as well as the acquisition of Bank Positiv. We will continue to work hard to build market share in these turbulent times” – said Michael Eggleton, Eurasian Bank’s CEO and Supervisory Board member.
The bank has received a Kazakhstani tenge (KZT) 6 billion (about USD19.5 million) capital injection in November 2015 and plans to consolidate Bank Pozitiv by the end of this year, which will result in capital gain of around KZT2.6 billion, under our estimates.
While we anticipate credit losses in 2016, we see the capital injection from shareholders as a buffer that will support the bank's financial profile going forward. In addition, although we expect Eurasian Bank's NPLs to stay high close to 10% of overall loans, we consider that the advanced collection processes will result in better recovery of its problem loans compared with our expectations for most other Kazakh banks, – says the release of S&P.
About Eurasian Bank:
Eurasian Bank is a universal commercial Kazakhstan bank catering products and services to clients in all segments. The Bank was founded in 1994. It covers all regions of Kazakhstan and has a subsidiary in Russia (Moscow) with branches in Omsk, Novosibirsk and Chelyabinsk. It is rated “B” by S&P. Eurasian Bank is a member of KASE and a party to KazPrime.
The Bank’s accomplishments were acknowledged by the following awards: Best Bank – Kazakhstan in 2014 (IAIR), Best Bank – Kazakhstan in 2013 and 2014 (EMEA Finance), Domestic Retail Bank of the Year, Kazakhstan in 2012, 2013 and 2015 (Asian Banking & Finance), Best Bank in Kazakhstan, 2012 (Euromoney), and Bank of the Year 2012 and 2014 in Kazakhstan (The Banker).
Eurasian Bank JSC
tel. +7 (727) 2 599 599 (ext. 3288)