TEXT-S&P summary: Central-European International Bank Ltd.

Fri Jan 11, 2013 6:01am EST

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(The following statement was released by the rating agency)

Jan 11 -

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Summary analysis -- Central-European International Bank Ltd. ------ 11-Jan-2013

(Unsolicited Ratings)

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CREDIT RATING: Country: Hungary

Local currency BBpi/--/--

Primary SIC: Commercial banks,

nec

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Credit Rating History:

Local currency Foreign currency

13-Dec-2011 BBpi/-- --/--

06-Apr-2009 BBB-pi/-- --/--

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Major Rating Factors

Strengths:

-- Strategic importance to its major shareholder, Italian bank Intesa Sanpaolo, which we believe will likely provide extraordinary support to Central-European International Ban Ltd. if needed.

-- Strong domestic franchise and market position.

-- Stable funding and liquidity profile, given our expectation that Intesa Sanpaolo will continue its funding support.

Weaknesses:

-- Higher-than-average economic and industry risks associated with operating in Hungary.

-- Weak asset quality, notably because of risks associated with mortgage loans denominated in Swiss francs.

-- Weak profitability.

-- Low capacity to build capital internally and dependence on parent's support to meet regulatory capital ratios.

Rationale

Standard & Poor's Ratings Services bases its unsolicited public information ('pi') rating on Hungary-based Central-European International Bank Ltd. (CIB) on the bank's 'bb-' anchor, as well as our view that CIB's business position, funding, and liquidity represent neutral factors for the rating. Furthermore, we also assess CIB's risk position and capital and earnings as negative factors for the rating. We evaluate CIB's stand-alone credit profile (SACP) in the 'b' category.

We typically do not use modifiers (positive or negative) or outlooks for 'pi' ratings.

Related Criteria And Research

All articles listed below are available on RatingsDirect on the Global Credit Portal, unless otherwise stated.

-- Various Ratings Actions Taken On Hungarian Banks Due To Rising Economic Risks, Dec. 19, 2012

-- Banks: Rating Methodology And Assumptions, Nov. 9, 2011

-- Banking Industry Country Risk Assessment Methodology And Assumptions, Nov. 9, 2011

-- Group Rating Methodology And Assumptions, Nov. 9, 2011

-- Bank Capital Methodology And Assumptions, Dec. 6, 2010

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