Fitch Ratings on May 26 took rating actions on JSCB Evrofinance-Mosnarbank Bank JSC and Vnesheconombank units Interregional Bank for Settlements of the Telecommunications & Postal Services, or Sviaz-Bank, and GLOBEX Commercial Bank JSC.
The rating agency downgraded Sviaz-Bank's long-term foreign- and local-currency issuer default ratings to BB- from BB, with a negative outlook.
At the same time, the agency affirmed the long-term foreign- and local-currency issuer default ratings of GLOBEX Commercial Bank and Evrofinance-Mosnarbank Bank at BB- and B+, respectively. The outlook is negative on GLOBEX Commercial Bank's ratings and stable on those of Evrofinance-Mosnarbank Bank.
Fitch also affirmed the short-term foreign-currency issuer default ratings of all three banks at B. The agency also affirmed the support ratings of Sviaz-Bank and GLOBEX Commercial Bank at 3 and that of Evrofinance-Mosnarbank Bank at 5.
The viability ratings of Sviaz-Bank, GLOBEX Commercial Bank and Evrofinance-Mosnarbank Bank were affirmed at "b", "b-" and "b+," respectively. The agency also affirmed Evrofinance-Mosnarbank Bank's No Floor support rating floor.
The downgrade is based on Sviaz-Bank's treatment by its sole shareholder state-owned VEB as a nonstrategic investment, which it plans to sell by the end of 2017. However, Fitch thinks that the sale may take longer or not happen at all due to VEB's sale price expectations and generally low investor interest.
Fitch said it sees a moderate probability of Sviaz-Bank and GLOBEX Commercial Bank receiving support from VEB, in case of need.