Moody's downgrades subordinated debt of three Russian banks

Moody's Investors Service said it downgraded the long-term subordinated debt ratings of Alfa-Bank to Ba3 from Ba2, Bank of Moscow to B1 from Ba3 and Gazprombank to Ba3 from Ba1. This concludes the review for downgrade that began on April 2, and the outlook is stable.

The downgrade was driven by Moody's view that the risk profile of junior debt instruments has increased in Russia given the global trends of imposing losses on subordinated creditors as part of bank bailouts orchestrated by governments.

The agency noted that Alfa-Bank's Ba1 senior debt rating, Bank of Moscow's Ba2 senior debt rating and Gazprombank's Baa3 senior debt rating were not affected.

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