Fitch increases ratings for three Belarusian state banks


The long-term issuer default rating of Belarusbank, Belagroprombank and Belinvestbank has been raised from B- to B. The outlook of Belarusbank and Belinvestbank has been changed from negative to stable, with the two banks’ individual rating affirmed at D/E. The outlook on long-term issuer default rating of BPS Bank, Beltransgaz, Belvnesheconombank and VTB Bank Belarus has been changed from negative to stable.

The higher ratings and the revised outlook of the state banks reflect Fitch’s belief that the Belarusian government is now more capable of supporting these banks in comparison with the situation that was registered at the peak of the global financial crisis. In particular, the Belarusian government’s hard currency reserves stood at $6 billion at the end of Q3 2010 while at the end of H1 2009 the figure stood at $2.6 billion. The Belarusian government’s hard currency reserves exceed external liabilities of the three banks by 220% (as of the end of H1 2010). Meanwhile, hard currency deposits in these banks have been stable through the crisis. This is why Fitch believes that a drain on foreign currency deposits that will require the government’s aid in the future is less likely.

The agency’s view on more stable short-term forecast for sovereign finances and banks of Belarus is confirmed by higher performance indicators of the Belarusian economy. In particular, this year’s GDP growth is much higher than last year’s.

According to www.belta.by