Moody's cuts National Bank Trust to B2

Moody's Investors Service said it downgraded the long-term foreign- and local-currency deposit ratings and foreign-currency senior unsecured debt ratings of both National Bank Trust and Investment Bank Trust to B2 from B1. National Bank's long-term national-scale credit ratings were downgraded to Baa1.ru from A1.ru and were placed on review for possible further downgrade while the ratings of Investment Bank were withdrawn. The banks' not-prime short-term foreign- and local-currency ratings and E+ bank financial strength ratings were affirmed.

The outlook is stable.

The downgrade follows the significant outflow of deposits that National Bank - the surviving bank of the two merged entities - has suffered, forcing it to revert to the Central Bank of Russia as the lender of last resort, which has provided 25% of the bank's liabilities as of mid-Nov., Moody's said.

The agency said it is concerned with the likelihood of further deterioration in macroeconomic conditions in Russia.

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