Fitch Ratings promoted Bank Russkiy Standard’s Issuer Default Rating outlook from Stable to Positive and confirmed the rating at B+.

We reconsidered the rating outlook because we expect the bank to start growing again after three years of run-down lending; this is likely to improve the company’s performance indicators because of greater profit generation and a larger scale of doing business. What is more, we feel very positive about the bank becoming less dependent from the finances it gets on the capital market and about the bank proving capable of paying off its $4bn market funds during the recession period. The bank’s rating are still sustained due to its extensive client base, impressive margin profits figures, and a good record of asset quality management,’ Fitch Ratings explains.

At the same time there still remains some uncertainty regarding the bank’s long-term prospects, as the competition on the Russian consumer lending market is getting fierce. The recently weakened market capitalization is another negative factor for the bank’s paying capacity, while the stability of the recently acquired retail deposits yet has to stand the test of time,’ the agency says.

The bank’s long-term Issuer Default Rating could be promoted if Russkiy Standard manages to go through with its expansion and profitability-boosting strategy while keeping its credit risk and capital at acceptable levels. The outlook could be changed to Stable in case the bank’s performance indicators still look only modest, in case the capital gets weaker, or in case the bank spends up its liquidity cushion and will thus become more dependent on the retail deposits,’ the experts note.