Fitch affirmed CBM's rating at 'BB'
Following the publication of Fitch's revised Bank Rating Criteria on 28 February 2020, Fitch placed CBM's rating under criteria observation and then affirmed it at 'BB'.
The rating was affirmed against the backdrop of suppressed economic activity and deteriorating macroeconomic indicators, and the agency's decision to downgrade the sector outlook for Russian banks from «Stable» to «Negative» due to the economic pressure from the coronavirus outbreak and the oil price slump.
Rating-positive factors noted by the analysts include a reasonable capital buffer and comfortable liquidity, as well as the absence of a large stock of unreserved problem loans. However, Fitch expects greater margin pressure, noting, on the other hand, that the Bank reported healthy pre-impairment results in 2019, suggesting its business model can successfully absorb the impact of the banking sector's increased risks.
Further rating actions of the Agency will depend on the economic impact caused by the coronavirus outbreak and the lower oil prices, and the Bank's capacity to cover those risks.