(Repeat for additional subscribers)
June 20 (The following statement was released by the rating agency)
Fitch Ratings has assigned Russia-based IBA-Moscow's (IBAM) RUB3bn bond issue a final 'BB'
rating. The issue benefits from recourse to IBAM's parent, International Bank of Azerbaijan
The bond has a 10.75% interest rate and a three-year tenor with an early
redemption option in December 2014. Should IBAM fail to make an interest or
principal payment under the terms of the bond, bondholders will benefit from a
put option, allowing them to sell the bonds to IBA.
IBA's offer to purchase the bonds in case of a default by IBAM represents an
irrevocable undertaking and ranks equally with IBA's other senior unsecured
obligations, save those preferred under Azerbaijan law. Under Azerbaijan law,
retail depositors rank ahead of other senior unsecured creditors. Retail
deposits accounted for 25% of IBA's total liabilities at end-2012, according to
the bank's unconsolidated statutory accounts.
KEY RATING DRIVERS AND SENSITIVITIES
The assignment of the final rating follows the completion of bond placement,
which was initially assigned an expected 'BB(EXP)' rating. For more details
please see 'Fitch Rates IBA-Moscow's Bonds 'BB(EXP)' dated 27 March 2013
available at www.fitchratings.com.