Moody's eyes Ukrainian banks for cut

Moody's Investors Service said it placed on review for downgrade the long-term ratings and assessments of seven Ukrainian banks following Moody's review for downgrade of Ukraine's B3 sovereign rating on Friday.

Among others, Moody’s said it will review the long-term senior unsecured debt ratings of two banks Savings Bank of Ukraine and Ukreximbank (Export-Import Bank of Ukraine) and Ukreximbank’s long-term subordinated debt rating.

The review reflects expectations the ratings will likely be downgraded in case of a downgrade of the sovereign rating, given that most banks have large direct exposure to the domestic debt issued by the national government, the agency said.

“The rating action also captures Moody's view that a protracted military conflict in Ukraine would heighten liquidity challenges in the banking system, severely disrupt the banks' operating environment and ultimately lead to a significant deterioration in the banks' credit profiles,” the agency said in a press release.

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