Moody's rates Sberbank notes A2, A3

Moody's Investors Service said it assigned A2 long-term and Prime-1 short-term foreign-currency debt ratings to loan participation notes to be issued by SB Capital SA for the purpose of financing loans to Russia-based Sberbank. Long-term subordinated notes that may also be issued by SB Capital have been rated A3. The expected total amount of senior and subordinated notes to be issued is up to $10 billion.

The outlook is stable.

The agency said the ratings are based on the fundamental credit quality of Sberbank, the crucial role it plays in Russia's economy and banking system, the bank's majority state ownership and the high likelihood of Sberbank receiving support from the Russian authorities in case of need.

The ratings also reflect the possibility that the Russian government could impose a debt moratorium in the event of default on its own foreign-currency obligations and that the bank's bonds might be particularly affected, the agency said.

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