S&P upgraded Promsvyazbank's rating to BB

S&P upgraded Promsvyazbank's rating to BB

S&P upgraded Promsvyazbank's rating to BB

The international rating agency S&P Global Ratings has raised the long-term credit rating of the issuer Promsvyazbank to BB from BB-. The forecast is “stable”, the agency said in a press release. The short-term rating was affirmed at 'B'.

“We believe that the role of Promsvyazbank for the Russian government has increased, since, according to our estimates, its share in financing contracts in the country's defense sector has increased to about 60%,” the report says. will be supported by capital injections from the state. ”

The outlook is stable as S&P GR analysts expect the bank's own credit profile to remain robust despite the challenging operating environment in Russia, supported by its critical role and very strong government ties.

According to the agency's experts, the bank's risk-adjusted capital ratio (RAC) will decline to 5.7-5.8% by the end of 2022, compared to about 6.3% at the end of 2019.

They also predict that the bank's loan portfolio will grow by about 45% this year. However, growth is expected to slow down to 5-15% over the next two years.

Promsvyazbank, owned by the Ananiev brothers, fell under reorganization in December 2017, the bank was transferred to the Banking Sector Consolidation Fund, controlled by the Central Bank of the Russian Federation. Later it became the property of the Federal Property Management Agency. On the basis of Promsvyazbank, a bank was created to service the state defense order and large state contracts.

According to the results of the 1st half of 2020, Promsvyazbank ranked 8th in terms of assets in the Interfax-100 ranking prepared by Interfax-CEA.

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