Fitch changes New Development Bank view

Fitch Ratings said it revised the outlook on New Development Bank's long-term issuer default rating to negative from stable and affirmed the issuer default rating at AA+.

Fitch also affirmed the bank’s short-term issuer default rating at F1+.

The agency said the negative outlook is primarily driven by the risk that, in the context of the Russia-Ukraine war, the presence and role of Russia as a large shareholder in the bank (19% of capital as of end-2021) leads to a downward revision of the agency’s assessment of the bank's business profile and operating environment.

Fitch said this currently provides a one-notch uplift over the agency’s assessment of the bank's solvency.

In addition, the bank’s country exposure to Russia (13% of loans as of end-2021, 70% of which is to the sovereign) poses downside risks to the bank's credit risk profile and solvency.

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