Moody’s lowers Bank Otkritie to negative

Moody’s Investors Service said it changed Bank Otkritie Financial Corp. PJSC’s outlook to negative from stable on its Ba3 long-term debt and deposit ratings.

Moody’s also said it affirmed the bank’s debt and deposit ratings and its standalone bank financial strength rating at D-, which corresponds to a standalone baseline credit assessment of Ba3.

The agency also affirmed the bank’s B1 foreign-currency subordinated debt rating and not-prime short-term deposit ratings.

The outlook change is driven by the ongoing deterioration in Russia’s operating environment, which is expected to exert negative pressure on the bank’s financial fundamentals, Moody’s said.

The agency also said it expects weakening creditworthiness of the bank’s borrowers and increase in funding costs as a result of slowdown in the Russian economy, capital flight and the restricted international market access of Russian borrowers, along with depressed oil prices and depreciation of the Russian ruble.

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