The debt quality is low
International rating agency Moody's Investors Service downgraded the long-term deposit rating for 12 Ukrainian banks to the level Caa3. Earlier ratings of the financial institutions were around Caa2.
According to the criteria of the agency, Caa rating indicates that the quality of bank debt is very low. In addition, the establishment of this indicator is prone to high credit risk. Modifier 3 indicates that the liabilities of the bank are located in the lower part of the general rating category.
The report listed financial institutions with low quality debts on foreign currency deposits. These are Sberbank, Sberbank of Russia, FUIB, Privat, Finance and Credit, UkrEXIMBank, Prominvestbank, Raiffeisen Bank Aval, OTP Bank, VAB, Southern and Credit Dnipro.
In addition, Moody's has lowered the long-term rating of deposits in national currency from Caa1 to Caa2 for all listed lenders. Thus, the values have shifted from the top of the category CAA to mid range.
