Standard and Poor's has downgraded the outlooks of 19 mid-sized Russian banks, saying the country's deteriorating economic growth and the risks created by the political crisis in Ukraine will likely hit the banks' asset quality and profitability.
The U.S. credit rating agency said in a press release Tuesday that it had knocked the outlook on 18 banks down from "stable" to "negative," among them Vozrozhdeniye, Petrocommerce and International Bank of St. Petersburg, all comfortably within Russia's top 100 banks. Bank Soyuz, also in the top 100, had its outlook switched from "positive" to "stable."
A further 11 banks, including Bank of Moscow, Uralsib and Nomos, all among Russia's top 20 banks, had their outlooks confirmed at "stable," as did Otkritie, which ranks 32 by assets, according to rating agency RIA Ratings.
S&P forecasts 1 percent economic growth in Russia this year — a far cry from the 3.4 percent achieved in 2012 — followed by an extended period of weak growth. Meanwhile, Russia's standoff with the West over Ukraine is hitting domestic and international investor confidence, damaging Russian banks' ability to access funding.
In late April, S&P downgraded Russia's sovereign debt rating from BBB to BBB-, one notch above junk status.
See also:
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
