Moody’s: Asian-Pacific view to negative

Moody's Investors Service said it changed the outlook on Asian-Pacific Bank's B2 long-term foreign and local-currency deposit ratings and B2 senior debt ratings to negative from stable.

The negative outlook reflects increased pressure on Asian-Pacific Bank's asset quality and profitability, following a deterioration in quality of Russian retail portfolios.

Concurrently, the ratings were affirmed, along with the bank's Not Prime short-term foreign currency and local currency deposit ratings. The agency also affirmed the bank's E+ standalone bank financial strength rating, which maps into a baseline credit assessment of b2, with a stable outlook.

Moody’s said the outlook change was is driven by (a) the pressure on asset quality and profitability related to heightened risks in the bank's consumer loan portfolio; (b) the bank's relatively low reserve coverage of non-performing loans; and (c) pressure on currently moderate capital adequacy as additional provisioning charges are likely to be needed.

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