S&P downgrades Uralsib

Standard & Poor’s said it lowered the long-term rating on Uralsib OJSC to B from B+.

The agency also said it placed the B long-term and B short-term ratings on CreditWatch with negative implications.

The downgrades reflect the bank’s continued weak financial performance and – as a result – additional pressure on its capital and profitability, which constrains the bank’s loss absorption capacity amid the economic recession in Russia, S&P said.

The CreditWatch placement also considers a view that the recently deteriorated economic environment in Russia may intensify pressure on the bank’s financials, especially its asset quality and earnings capacity, the agency said.

S&P said it believes a materially increased cost of funding and higher credit costs are weighing on the bank’s already weak financial profile.

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