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15.05.2007
Credit rating assigned to bond issue by Universal Bank for Development and Partnership upgraded to uaBBB-
Credit-Rating, a nationally-recognized credit rating agency in Ukraine has today upgraded to uaBBB- (uaBBB minus) from uaBB+ (uaBB plus) the long-term credit rating assigned to issue of registered coupon bonds (A, B series) by Kiev-based Universal Bank for Development and Partnership OJSC (Bank) for the amount of UAH 40m with the original maturity of A series 3 years and of B series 5 years. Outlook on the rating has been changed to Positive from Stable. To revise the rating Credit-Rating used Bank's financial statements for 2006 as well as other inside information furnished by the Bank.
The uaBBB issuer rating reflects Bank's adequate capacity to timely and in full meet its commitments on the obligations in the Ukrainian financial market environment. There is, though, a higher vulnerability to the effect of adverse changes in business, financial and economic conditions as compared to obligors with higher ratings. The '+' and '-' modifiers denote ratings relative status within major categories.
In the course of the rating's revision procedure the following factors have been taken into consideration: Bank's enhanced performance, specifically Bank's net revenue rose 61% as compared to 2005 with the ROA and ROE grown by 0.4 p.p. and 1.49 p.p. (0.83% and 5.08% respectively). The 2006 growth rates of Bank's equity amounted to 80% having exceeded growth rates of assets and of credit portfolio, which resulted in growing indicators of securitization of active operations and of credit portfolio. These indicators exceed those of the Ukrainian banking system as of Jan 1, 2007. At the same time Credit-Rating notes poor quality of Bank's credit portfolio, in fact as of Jan. 1, 2007 the specific gravity of negatively classified credits in Bank's credit portfolio amounted to 52.3% with 97.9% of them being substandard indebtedness.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may be found in the REUTERS, BLOOMBERG and FTN monitor information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
