Moody's downgrades SME Bank

Moody's Investors Service said it downgraded SME Bank's long-term senior unsecured debt rating to B3 from Ba2, among other ratings. The agency also changed the outlook to developing from negative.

“The downgrade of SME Bank's ratings is driven by the recently reported and further anticipated material credit losses, which weakened the bank's solvency profile,” Moody’s said in a press release.

The agency noted SME Bank reported losses of RUB 991 million in 2020 and RUB 1.14 billion in Q1 2021, and it expects more losses by the end of 2021.

The outlook reflects the expectation there are a number of diverse scenarios that could help or hurt the rating in the next 12-18 months, which depend on the bank's ability to contain downside risk and stabilize its solvency profile, Moody’s said.

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