RPT-Fitch Rates SDM-Bank's Upcoming Unsecured Bond Issues 'B+(EXP)'

Fri Jan 24, 2014 4:16am EST

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Jan 24 (Reuters) - (The following statement was released by the rating agency)

Fitch Ratings has assigned JSC SDM-Banka€™s (SDM) upcoming RUB3bn BO-01, RUB3bn BO-02 and RUB2bn BO-03 Series domestic bond issues expected Long-term local currency ratings of a€˜B+(EXP)a€™ and National Long-term ratings of a€˜A-(rus)(EXP)a€™. The bondsa€™ expected Recovery Rating is a€˜RR4(EXP)a€™.

The final rating is contingent upon the receipt of final documents conforming to information already received.

SDM has Long-term foreign and local Issuer Default Ratings (IDR) of 'B+' with Stable Outlooks, a Short-term IDR of 'B', , a Viability Rating of 'b+', a Support Rating of '5', a Support Rating Floor of 'NF' and a National Rating of 'A-(rus)'.

KEY RATING DRIVERS

The issuesa€™ ratings correspond to SDMa€™'s 'B+' Long-term local currency IDR, which reflects the banka€™s limited size by international standards, resulting among other things, in significant concentrations on both sides of its balance sheet, but more positively, a lengthy track record of reasonable asset quality, comfortable liquidity, adequate profitability and conservative management.

RATING SENSITIVITIES

Any changes to SDMa€™s Long-term local currency IDR would impact the issuesa€™ ratings. Downside pressure on SDMa€™s Long-term local currency IDR could arise from huge deposit outflows and/or asset quality deterioration resulting in erosion of the banka€™s capital. Upside potential for SDM's Long-term local currency IDR is limited in the near term.

For more information on SDMa€™s credit profile, see Fitcha€™s full rating report dated 9 December 2013 at www.fitchratings.com.

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