S&P Global Ratings today lowered its long- and short-term issuer credit ratings on Eximbank Kazakhstan JSC (KazEximbank) to 'CCC+/C' from 'B-/B'.
The agency also lowered our Kazakh national scale rating on the bank to 'kzB-' from 'kzB+’.
“The downgrade reflects our view that KazEximbank’s business model and longer-term viability in the Kazakh banking sector are questionable,” S&P said in a message.
The vulnerability of KazEximbank's asset quality and its funding and liquidity profile led the agency to revise down the assessment of the bank's stand-alone credit profile (SACP) to 'ccc+' from 'b-' and, in turn, lower the issuer credit rating to 'CCC+' from 'B-'.
“In our opinion, the bank's reliance on favorable business, financial, and economic conditions to meet its financial commitments makes the bank susceptible to negative internal or external developments”.
Although KazEximbank may not face a credit or payment crisis in the coming 12 months, S&P assumes that the bank might not be able to meet its financial commitments in the long term in the absence of extraordinary shareholder support.
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