Moody's

Long-term foreign and local currency deposit ratings — «Ba1», outlook stable
Long-term  local currency senior debt ratings — «Ba1», outlook stable
Baseline credit assessment – «b3»
Short-term foreign and local currency deposit ratings — «Not Prime»
Long-term counterparty risk rating (local and foreign currency) — «Ba1»
Short-term counterparty risk rating (local and foreign currency) — «Not Prime»


MOODY'S RATING ACTION

On 12 February 2019, Moody's upgraded the local and foreign currency long-term bank deposits, and senior unsecured debt ratings of Russian Agricultural Bank. The rating action follows Moody's upgrade of Russia's sovereign debt rating to Baa3 from Ba1 on February 8, 2019.

The outlooks on RusAg’s ratings have been changed to stable from positive(m).

List of affected ratings:

Long-term foreign and local currency deposit ratings upgraded to «Ba1», outlook changed to stable from positive(m)
Long-term local currency senior debt ratings upgraded to «Ba1», outlook stable
Baseline Credit Assessment affirmed at «b3»
Short-term foreign and local currency deposit ratings affirmed at «Not Prime»
Long-term counterparty risk rating (local and foreign currency) affirmed at «Ba1»
Short-term counterparty risk rating (local and foreign currency) affirmed at «Not Prime»


MOODY'S RATING ACTION

On 26 June 2018, Moody's assigned Counterparty Risk Ratings (CRRs) to Russian banks.

Moody's Counterparty Risk Ratings are opinions of the ability of entities to honour the uncollateralized portion of non-debt counterparty financial liabilities (CRR liabilities) and also reflect the expected financial losses in the event such liabilities are not honoured. CRR liabilities typically relate to transactions with unrelated parties. Examples of CRR liabilities include the uncollateralized portion of payables arising from derivatives transactions and the uncollateralized portion of liabilities under sale and repurchase agreements. CRRs are not applicable to funding commitments or other obligations associated with covered bonds, letters of credit, guarantees, servicer and trustee obligations, and other similar obligations that arise from a bank performing its essential operating functions.

Russian Agricultural Bank:

Long-term Counterparty Risk Rating (Local and Foreign Currency), assigned Ba1

Short-term Counterparty Risk Rating (Local and Foreign Currency), assigned Not Prime


MOODY'S RATING ACTION

On 29 January 2018, Moody's affirmed the ratings, baseline credit assessments (BCAs), adjusted BCAs, standalone credit profile and counterparty risk assessments (CRAs) of RusAg and changed the outlook on the local and foreign-currency long term senior unsecured debt ratings, and local-currency deposit ratings to Positive from Stable. The rating action follows Moody's change of outlook on Russia's Ba1 sovereign debt rating to Positive from Stable. Moody’s believes that the capacity and willingness of the Russian government to assist its systemically important banks and financial institutions remains substantially unchanged.

MOODY'S RATING ACTION

On 21 February 2017, Moody's affirmed the ratings of Russian Agricultural Bank and changed the outlook on its long-term ratings to Stable from Negative. The rating action follows Moody's change of outlook on Russia's Ba1 sovereign debt rating to Stable from Negative. Moody’s believes that the capacity and willingness of the Russian government to assist its systemically important banks and financial institutions remains substantially unchanged.

MOODY'S RATING ACTION

On April 26, 2016, Moody’s confirmed Russian Agricultural Bank’s ratings earlier placed on review, namely Ba2 long-term foreign currency deposit rating and Ba1(cr) long-term Counterparty Risk Assessment. The rating action follows the confirmation of Russia’s sovereign rating.

MOODY'S RATING ACTION

On March 18, 2016, Moody's Interfax Rating Agency withdrew its Russia national scale ratings (150 entities). This decision was taken in light of legislative changes and other potential restrictions applicable to the business of providing NSRs in Russia.

MOODY'S RATING ACTION

On 9 March 2016, Moody’s Investors Service placed on review for downgrade the ratings of 36 financial institutions domiciled in Russia and Kazakhstan, due to a combination of likely further erosion in the operating conditions for the financial institutions and their parent entities as well as fiscal pressure on the governments in these countries.

Russian Agricultural Bank’s Ba2 long-term foreign currency deposit rating, as well as its Ba1(cr) long-term Counterparty Risk Assessment were placed on review for downgrade. 

MOODY'S RATING ACTION

On June 23, 2015, Moody’s Investors Service has affirmed all ratings of four Russian banks, including Russian Agricultural Bank.
Moody’s affirmation of Russian Agricultural Bank’s long and short-term deposit, senior debt and subordinated debt ratings reflects the affirmation of the bank’s «b3» BCA. The Bank’s long-term senior unsecured debt and deposit ratings benefit from a very high probability of government support in case of need from the Russian government, leading to a four notch uplift for its senior unsecured debt and deposit ratings.
List of affected ratings:

  • Baseline Credit Assessment — affirmed at «b3»;
  • Long-Term Deposit Ratings — affirmed at «Ba2», outlook ‘Negative’;
  • Short-Term Deposit Rating — affirmed at «NP»;
  • Senior Unsecured Regular Bond/Debenture — affirmed at «Ba2», outlook ‘Negative’;
  • Subordinate Regular Bond/Debenture — affirmed at «B2».

At the same time, Moody’s has withdrawn the outlooks on subordinated instrument for its own business reasons. Outlooks, which indicate the direction of rating pressures, are now only assigned to long term senior debt and deposit ratings.

Moody’s has also assigned Counterparty Risk Assessments to five Russian banks, including Russian Agricultural Bank, and two subsidiaries, in line with its new bank rating methodology published on March 16, 2015: http://www.moodys.com/viewresearchdoc.aspx?docid=PR_320662 Russian Agricultural Bank was assigned Counterparty Risk Assessment at «Ba1(cr)» / «NP(cr)».

Counterparty Risk Assessment (CRA) (see Operating Obligations) — not a rating, but an assessment of the ability of an issuer to avoid defaulting on its operating obligations, taking into account the issuer’s intrinsic standalone strength as well as Moody’s assessment of the likelihood of affiliate and government support, and reflecting the anticipated seniority of the obligations in the liabilities waterfall. The CR Assessment also takes into account other steps regulatory authorities can take to preserve the key operations of a bank in a resolution. The CR Assessment is denoted on the long-term scale with a (cr) modifier, e.g. Baa1(cr), and does not bear an outlook. The short-term CR Assessment is derived from the long-term CR Assessment based on the guidance in Moody’s Cross Sector Global Short-Term Ratings methodology, and also bears a (cr) modifier, e.g. Prime-1(cr). The CR Assessment is a currency-neutral concept, but is constrained by the LC deposit ceiling.

Obligations and commitments covered by Moody’s CR Assessment include payment obligations associated with covered bonds (and certain other secured transactions), derivatives, letters of credit, third party guarantees, servicing and trustee obligations and other similar obligations that arise from a bank in performing its essential operating functions.

MOODY'S RATING ACTION

On 24 February 2015, Moody's Investors Service took rating actions on seven Russian financial institutions, including Russian Agricultural Bank. These actions follow the downgrade of Russia's government debt rating to “Ba1” from “Baa3” on 20 February 2015.

Specifically, Moody's has downgraded Russian Agricultural Bank’s supported senior unsecured, subordinated debt and deposit ratings. These ratings incorporate uplift based on Moody's assessment of the likelihood of government (systemic) support being made available, in case of need. The outlook on the long-term ratings is negative.

The following ratings of Russian Agricultural Bank have been affected:

  • Long-term LC and FC Deposit ratings were downgraded to Ba2 from Ba1, outlook was revised to negative;
  • Long-term LC and FC Senior Unsecured ratings were downgraded to Ba2 from Ba1, outlook was revised to negative;
  • Long-term FC Senior Unsecured MTN program rating was downgraded to (P)Ba2 from (P)Ba1;
  • Long-term FC Subordinate rating was downgraded to B2 from B1, outlook was revised to negative;
  • Long-term FC Subordinate MTN program rating was downgraded to (P)B2 from (P)B1.

The standalone BFSR of Russian Agricultural Bank at “E+” (b3) was not affected by this rating action and remains on a negative outlook.

On 24 February 2015, Moody's Interfax Rating Agency downgraded to Aa2.ru from Aa1.ru the national scale rating (NSR) of Russian Agricultural Bank. The NSR carries no specific outlook.

MOODY'S RATING ACTION

On 23 December 2014, Moody's placed on review for downgrade the long-term deposit, debt and issuer ratings and bank financial strength ratings (BFSRs) of 16 Russian financial institutions, including Russian Agricultural Bank, in response to the ongoing severe deterioration in Russia's operating environment and financial market conditions.

RusAg’s Bank financial strength rating «Е+» remained unaffected.

Moody's Interfax Rating Agency placed on review for downgrade National Scale Rating (NSR) of 9 Russian financial institutions, including Russian Agricultural Bank.

MOODY'S RATING ACTION

On 20 October 2014, Moody's Investors Service has downgraded and placed on Negative outlook rating actions on seven Russian financial institutions, including Russian Agricultural Bank. These actions follow the weakening of Russia's credit profile, as reflected by Moody's downgrade of Russia's government debt rating to Baa2 from Baa1 on 17th of October, 2014.

Specifically, Moody's downgraded the supported senior unsecured, subordinated debt and deposit and issuer ratings of the government-owned Russian financial institutions. The outlook on the long-term ratings of these institutions is negative.

These ratings incorporate Moody's assessment of the systemic support uplift that is derived from Russia's government debt rating.

The following ratings of Russian Agricultural Bank have been downgraded and placed on negative outlook:

  • LC/FC Senior Unsecured debt ratings and deposit ratings to Ba1;
  • FC Senior Unsecured MTN to (P)Ba1;
  • FC subordinated rating to B1 and FC subordinated MTN rating to (P)B1;
  • LC/FC short-term deposit ratings have been downgraded to Not Prime.

On 21 October 2014, Moody's Interfax Rating Agency has downgraded to Aa1.ru from Aaa.ru National Scale Rating (NSR) of Russian Agricultural Bank. The NSR carries no specific outlook.

The NSR incorporates Moody's assessment of the systemic support uplift that is derived from Russia's government debt rating.

MOODY'S RATING ACTION

On July 2, 2014, Moody's Investors Service has confirmed the supported long-term debt, issuer and deposit ratings of six Russian financial institutions, including Russian Agricultural Bank. Rating actions follow the rating agency's confirmation of Russia's Baa1 government bond rating with a negative outlook on 27 June 2014.
The confirmation of the sovereign rating means that the level of systemic support that Moody's incorporates into the six financial institutions' affected ratings remains unchanged, thus prompting the confirmation of their supported long-term ratings.
This rating action concludes the review of these ratings initiated by Moody's in April 2014.

On July 3, 2014, Moody's Interfax Rating Agency has confirmed the Aaa.ru national scale rating of Russian Agricultural Bank following the rating agency's confirmation of Russia's Baa1 government bond rating with a negative outlook on 27 June 2014. The NSRs carry no specific outlook.
This rating action concludes the review of the bank’s NSRs initiated by Moody's in April 2014.

MOODY'S RATING ACTION

On April 1, 2014, Moody's Investors Service has placed on review for downgrade the supported senior unsecured, subordinated debt and deposit ratings of the six Russian financial institutions, including Russian Agricultural Bank. These ratings incorporate systemic support uplift that is derived from Russia's government debt rating. Rating actions follow Moody's placement of Russia's Baa1 government bond rating on review for downgrade on 28 March 2014.

The following ratings have been placed on review for downgrade:

  • Long-term foreign and local-currency deposit ratings at Baa3;
  • Long-term foreign and local-currency senior debt ratings at Baa3;
  • Short-term foreign and local-currency deposit ratings at Prime-3;
  • Long-term foreign currency subordinated debt ratings at Ba3.

On April 1, 2014, Moody's Interfax Rating Agency has placed on review for downgrade the Aaa.ru national scale rating of two Russian government-related banks, including Russian Agricultural Bank. The rating actions follow the review for downgrade of the Russia's (Baa1) government bond rating.

RUSSIAN AGRICULTURAL BANK RATINGS LOWERED BY MOODY'S INVESTORS SERVICE

On July 5, 2013 Moody's Investors Service downgraded ratings of four state-related banks including Russian Agricultural Bank.

Rating actions on the long-term senior debt and deposit ratings and short-term deposit ratings are mainly driven by Moody's reassessment of the level of capacity of the Russian government to provide systemic support to these banks in case of need. Key drivers are:
(1) The government's fiscal position has weakened compared to 2008, reducing the country's ability to absorb potential shocks, such as a prolonged decline in oil price.
(2) Fiscal reserves accumulated by the government to cover the budget and pension deficits diminished materially since 2008.

Action on subordinated debt ratings is driven by Moody's view that the risk profile of junior debt instruments has increased in Russia, given the global trends of imposing losses on junior creditors as part of bank bailouts orchestrated by governments.

RusAg’s ratings are changed as follows:

  • Long-term foreign and local-currency deposit ratings downgraded to Baa3 from Baa1; stable outlook;
  • Long-term foreign and local-currency senior debt ratings downgraded to Baa3 from Baa1; stable outlook;
  • Long-term foreign currency subordinated debt ratings downgraded to Ba3 from Baa2; stable outlook;
  • Short-term deposit ratings downgraded to P-3 from P-2;
  • BFSR of E+, affirmed; outlook revised to negative from stable.

MOODY'S RATING ACTION

On April 2, 2013 Moody's Investors Service has placed the long-term senior debt, subordinated debt and deposit ratings of Sberbank (A3), Bank VTB (Baa1), VTB24 (Baa1) and Russian Agricultural Bank (Baa1) on review for downgrade. The review is driven by Moody's concerns that the Russian government's (Baa1 stable) capacity and willingness to provide systemic support to large banks in times of systemic stress could potentially be lower than previously anticipated by the rating agency.

Nevertheless, Moody's will continue to incorporate a high likelihood of systemic support into the ratings of large Russian banks and financial government-related institutions (GRIs), based on the government's strong track record of support, still adequate reserves and controlling ownership of large banks.

MOODY'S AFFIRMED RUSSIAN AGRICULTURAL BANK’S RATINGS

On January 21, 2011 Moody's Investors Service affirmed the following ratings of Russian Agricultural Bank: Bank financial strength rating (BFSR) – E+, long- and short-term foreign currency deposit ratings – Baa1/Prime-2, as well as the senior unsecured debt rating of Baa1 and the Bank's subordinated debt rating of Baa2. All these ratings carry a stable outlook. Moody's Interfax Rating Agency has affirmed the Aaa.ru long-term national scale credit rating of RusAg.
The ratings are supported by the Bank's developed franchise in the Russian agribusiness sector and its position as the fourth-largest bank in the country in terms of assets and capital.
The rating agency observes consistently strong capital ratios of the Bank, demonstrating the government's commitment to support RusAg which plays a key role in agribusiness of the Russian Federation.

MOODY'S ASSIGNS Baa1 RATING TO RUSSIAN AGRICULTURAL BANK'S SENIOR UNSECURED DEBT

On October 08, 2010 Moody's assigned a long-term global local currency debt rating to Russian Agricultural Bank's senior unsecured debt. The rating carries a Stable outlook. Any subsequent senior debt issuance by RusAg will be rated at the same rating level, subject to there being no material change in the bank's overall credit rating.
The rating of Baa1 was assigned to the following debt instruments:

  • RUB 5,000M Senior Unsecured Regular Bonds due 8/28/2013;
  • RUB 10,000M Senior Unsecured Regular Bonds due 8/28/2013;
  • RUB 10,000M Senior Unsecured Regular Bonds due 2/09/2017;
  • RUB 10,000M Senior Unsecured Regular Bonds due 9/27/2017;
  • RUB 5,000M Senior Unsecured Regular Bonds due 6/05/2018;
  • RUB 5,000M Senior Unsecured Regular Bonds due 2/09/2018;
  • RUB 10,000M Senior Unsecured Regular Bonds due 11/27/2018;
  • RUB 5,000M Senior Unsecured Regular Bonds due 11/14/2019;
  • RUB 5,000M Senior Unsecured Regular Bonds due 11/14/2019;
  • RUB 5,000M Senior Unsecured Regular Bonds due 1/29/2020;
  • RUB 5,000M Senior Unsecured Regular Bonds due 1/30/2020.

The assigned rating is in line with RusAg's global local currency deposit rating Baa1/Prime-2 and based on Moody's assessment that the probability of support from the Russian government in the event of need is very high, as the state holds 100% of RusAg's issued and outstanding shares.

RUSSIAN AGRICULTURAL BANK RATINGS LOWERED BY MOODY'S INVESTORS SERVICE

On February 24, 2009 Moody's Investors Service downgraded the local currency deposit ratings of eight banks of the Russian Federation including Russian Agricultural Bank.
RusAg's local currency deposit ratings were downgraded to Baa1/P-2 from A3/P-1. The foreign currency deposit rating of RusAg was affirmed at Baa1, stable; the outlooks on other RusAg's local and foreign currency debt and deposit ratings remained stable. All ratings remain investment grade. Given its importance for agribusiness sector RusAg is considered of systemic importance to the Russian Federation.
Moody's affirmed the bank financial strength ratings (BFSRs) of all 8 banks but changed the outlooks on the BFSRs to negative from stable for all the banks except for Russian Agricultural Bank (RusAg), where it was changed to E+, stable from E+, positive.
According to Moody's these rating actions reflect the increasingly negative impact of the global economic crisis on the economy of the Russian Federation and on the intrinsic strength of its financial institutions. Moody's has taken the view that the banks' local currency ratings need to be more closely aligned with the government's local currency debt rating, since it now represents the primary driver of their credit strength.
Following Moody's rating actions RusAg ratings are:
- BFSR: Affirmed at E+, outlook changed to stable from positive;
- Local currency deposit ratings: downgraded to Baa1/P-2 from A3/P-1;
- Foreign currency deposit ratings: Affirmed at Baa1/P-2;
- Senior unsecured local and foreign currency debt rating: downgraded to Baa1 from A3;
- Subordinated foreign and local debt ratings: downgraded to Baa2 from Baa1;
- The outlook on all of the bank's deposit and debt ratings is stable.

MOODY'S REVISED OUTLOOK ON RUSSIAN AGRICULTURAL BANK RATING

On December 12, 2008 Moody's Investors Service has revised the outlook on the country ceiling of the Russian Federation for foreign-currency deposits Baa1 from positive to stable due to increased influence on the country’s external liquidity position.
Following this rating action Moody’s has also revised the outlook on Russian Agricultural Bank long-term foreign currency deposit rating Baa1 from positive to stable.
Other ratings were confirmed at current levels.

MOODY'S UPGRADED RATING OF RUSSIAN AGRICULTURAL BANK

On July 16, 2008 Rating Agency Moody's Investors Service has upgraded local and foreign currency bond ratings of the Russian government to Baa1 (positive outlook) and also upgraded Russia’s country ceiling for foreign-currency deposits to Baa1 (positive outlook) from Baa2.

Following this rating action Moody’s has also upgraded Russian Agricultural Bank long-term foreign currency deposit rating to Baa1 (positive outlook). The rating actions primarily reflect Moody’s recognition of the country’s strong macroeconomic situation and favorable debt metrics.

RUSSIAN AGRICULTURAL BANK RATINGS OUTLOOK IS UPGRADED TO POSITIVE BY MOODY’S

On June 25, 2007 Rating Agency Moody's Investors Service has upgraded the outlook on Russian Agricultural Bank’s (RusAg) E+ the Bank Financial Strength Rating, A3 local currency deposit rating, A3 senior unsecured debt rating and Baa1 subordinated debt rating to positive from stable. The bank's foreign currency deposit ratings and the national scale rating remain unchanged at Baa2/Prime-2/ Aaa.ru. The outlook for the long-term deposit rating in foreign currency is stable.
The outlook change reflects RusAg's growing franchise value: it is currently the eighth's largest bank in the country in terms of total assets, it has the second largest in Russia branch network comprising 71 regional branches and 762 outlets, it occupies dominant position in servicing Russian agriculture and its penetration of the retail segment is increasing.

RATING AGENCY MOODY'S HAS UPGRADED RUSSIAN AGRICULTURAL BANK’S SENIOR UNSECURED DEBT RATING TO A3

On May 26, 2006 Russian Agricultural Bank (RSHB Capital S.A.) Senior Unsecured Debt Rating (long-term foreign currency) has been upgraded to A3 from Baa1; the outlook remains stable. International Rating Agency Moody's Investor Service, following the application of its new rating methodology, announced the upgrading of the ratings of seven Russian banks, which recently issued obligations and bonds.

MOODY'S RAISES RUSSIAN AGRICULTURAL BANK RATING TO Baa2

On October 28, 2005 Moody's Investors Service has upgraded the global scale long- and short-term foreign currency deposit ratings of Russian Agricultural Bank to Baa2/Prime-2 from Ba1/Not Prime. The outlook of these ratings is stable.

This rating action follows Moody's recent decision to upgrade the Russian Federation's foreign currency bank deposit ceilings to Baa2/Prime-2 from Ba1/Not-Prime. The action applies to the deposit ratings that were constrained by the country ceilings and reflects the reduced foreign currency transfer risk as captured by the new ceilings.

At the same time, Moody's Interfax Rating Agency, which is majority-owned by Moody's, affirmed the Aaa.ru national scale ratings (NSRs) of Russian Agricultural Bank.

MOODY'S ASSIGNS Ba1/NP/E+ RATINGS TO RUSSIAN AGRICULTURAL BANK

On September 06, 2005 Moody's Investors Service has assigned Ba1 long-term and 'Not-Prime' (NP) short-term foreign currency deposit ratings and an E+ (E plus) financial strength rating (FSR) to Russian Agricultural Bank (RusAg). The outlook is positive for the long-term foreign currency deposit rating and stable for the other ratings. At the same time, Moody's Interfax Rating Agency, which is majority-owned by Moody's, has assigned an Aaa.ru long-term national scale credit rating (NSR) and a RUS-1 short-term rating to RusAg.

According to Moody's and Moody's Interfax ("Moody's"), the Ba1(pos) foreign currency deposit rating assigned to RusAg, which is at the country ceiling, relies on the bank's key role in the execution of government policy for agriculture development and its 100% ownership by the Russian state. Based on these factors Moody's assumes there is a very high likelihood of state support in case of need. Such support is confirmed by successive capital injections from the government since the bank's inception in 2000, the new shares issue to be completed by December 2005 that will more than double current level of equity, and by the presence of government and highly ranked administration officials on the bank's supervisory board.

The Aaa.ru long-term and RUS-1 short-term ratings on Moody's national scale signify an exceptionally high level of (supported) creditworthiness compared to other Russian borrowers/debt.