Moody's rates Kuznetski notes Ba2

Moody's Investors Service said it assigned a rating of Ba2 to the loan participation notes to be issued on a limited recourse basis by Kuznetski Capital SA, a Luxembourg-based special purpose entity, for the sole purpose of financing a loan to Moscow Municipal Bank - Bank of Moscow.

At the same time, this rating has been placed on review for possible upgrade. In addition, Moody's also placed on review for possible upgrade Bank of Moscow's existing Ba2 foreign currency deposit rating.

Moody's said that it views events relating to the recent banking sector turmoil in Russia as indicating that federal authorities may now be more willing to provide support to systemically important banks, as well as to smaller institutions with a significant share of retail funding.

In this context, the rating agency will focus during this review on the likelihood of support being granted by the Russian authorities to Bank of Moscow.

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