(The following statement was released by the rating agency)
Dec 27 -
Summary analysis -- National Bank For Foreign Economic Activity Of 27-Dec-2012
The Republic Of Uzbekistan
CREDIT RATING: B+/Stable/B Country: Uzbekistan
Primary SIC: Commercial banks,
Credit Rating History:
Local currency Foreign currency
16-Dec-2011 B+/B B+/B
12-Nov-2008 B/B B/B
Ratings Score Snapshot
Issuer Credit Rating B+/Stable/B
Business Position Strong (+1)
Capital and Earnings Moderate (0)
Risk Position Adequate (0)
Funding and Liquidity Above Average
and Adequate (0)
GRE Support 0
Group Support 0
Sovereign Support 0
Additional Factors 0
Major Rating Factors:
-- A government-related entity with a “very high” likelihood of extraordinary government support.
-- Strong domestic competitive position.
-- Above-sector-average funding profile with moderate confidence sensitivity.
-- High-risk operating environment.
-- Moderate capitalization.
-- Low diversity in the loan portfolio.
Standard & Poor’s Ratings Services’ outlook on the National Bank For Foreign Economic Activity Of The Republic Of Uzbekistan (NBU) is stable, reflecting the balance between the high economic and industry risk for banks operating in Uzbekistan and our expectation of continued state ownership and ongoing government support.
We are unlikely to raise the ratings on NBU unless we positively reassess the sovereign’s creditworthiness, given that it constrains the issuer credit rating. Owing to the tie between the ratings on Uzbek banks and the creditworthiness of the sovereign, bank-specific factors leading to a possible upward revision of the ratings appear limited. Accordingly, the ratings on NBU will largely be driven by the operating environment in Uzbekistan.
We would likely lower the ratings to reflect heightened economic and industry risk, such as a deterioration of the sovereign’s creditworthiness. A material deterioration in NBU’s currently strong business position or asset quality, which would impair the bank’s above-sector-average financial profile, would put pressure on the bank’s stand-alone credit profile (SACP). However, we currently consider this unlikely.
Related Criteria And Research
-- Banks: Rating Methodology And Assumptions, Nov. 9, 2011
-- Banking Industry Country Risk Assessment Methodology And Assumptions, Nov. 9, 2011
-- Rating Government-Related Entities: Methodology And Assumptions, Dec. 9, 2010
-- BICRA On Uzbekistan Revised To Group ‘8’ From Group ‘9’, Nov. 9, 2011