November 17, 2017 / 3:27 PM / a year ago

UPDATE 1-Two Russian banks in talks with central bank on their capital- Fitch

(Adds APB comment, central bank declines to comment)

MOSCOW, Nov 17 (Reuters) - Two Russian regional banks are in talks with the central bank about how to bolster their capital, according to a report by Fitch credit rating agency.

Russia’s banking industry is under increased scrutiny after two major private banks, Otkritie Bank & B&N Bank, sought bailouts from the central bank this year.

Fitch Ratings said in a note on Thursday that Asian-Pacific Bank, known as APB, and Uraltransbank, or UTB, had weak capital positions.

“Fitch understands that both banks have agreed capital rectification plans with the Central Bank of Russia, with certain milestones to be achieved within the next several months, while their inability to meet these targets may result in regulatory intervention,” Fitch said in a report.

“However, the (banks’ credit) ratings also reflect the fact that both banks are currently servicing their obligations and have reasonable liquidity cushions (larger at UTB),” Fitch said, retaining CCC credit rating for the two banks.

APB, one of Russia’s largest lenders in Siberia and the Far East and ranked number 56 in the country by assets, said in an emailed comment it had enough liquidity and “met all the requirements of the central bank.”

“The business model of APB is stable, as the central bank representatives have repeatedly said,” APB added.

UTB, Russia’s 197th biggest bank, has its headquarters in the Ural city of Yekaterinburg. It could not immediately be reached for comment. The bank’s website had no email for such enquiries and the phone number for the public relations department provided by the bank’s call centre went unanswered.

The central bank responded to a Reuters request for comment on the Fitch report by saying it did not comment on operating banks. (Reporting by Andrey Ostroukh; Editing by Katya Golubkova, Jane Merriman and Edmund Blair)

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