Fitch ranks Russian banks

In a new report by Fitch Ratings, the agency ranked 57 rated Russian banks based on their loan loss absorption capacity. Fitch said it considers this capacity to be currently weak at 10 of the banks reviewed, although most of the 10 could likely rely on capital support from shareholders and moderate at a further 14.

The extent of Russian banks' asset quality deterioration, their loss absorption capacity and contingency recapitalization plans are likely to be the main drivers of rating actions over the next 12 to 18 months, Fitch said.

Fitch said it ranked the loan loss absorption capacity of the 57 rated Russian banks to demonstrate their relative vulnerability to loan losses.

For 10 of the 57 banks - VTB24, Rossiya, Bank of Moscow, Swedbank (Russia), VTB, Moscow Bank for Reconstruction and Development, AK Bars, Rosbank, Orgresbank and Unicredit (Russia) - the maximum reserves/loans ratio is below 10%, the agency said, with loss absorption capacity ranked as weak.

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