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Russia Banks' FC Debt Servicing Could Withstand Sanctions

The imposition of very tough sanctions, especially on large commercial deposit-taking institutions, hampering their ability to service foreign-currency (FC) debt, is therefore unlikely. Other sanctions, including on sovereign debt, could be reasonably mitigated for banks by a combination of their own resources and state support.

Fitch Publishes 5M18 Russian Banks Datawatch

The latest edition of its "Russian Banks Datawatch", a monthly publication of spreadsheets with key data from Russian banks' statutory accounts.


RussianTranslation: опубликовало обзор российских банков за 5 месяцев 2018 года

Russian Growth Gets Limited Oil Price Boost; Reforms Key

Russia will see limited near-term economic gains from higher oil prices because of prudent monetary and fiscal policy settings under the country's improved policy framework, which reduces the impact of oil price moves. Boosting weak medium-term growth prospects is a key challenge for the new government. 


Russian Translation: цены на нефть имеют ограниченное влияние на рост экономики России; ключевой фактор - реформы

Some Russian Local Governments Might Lose on World Cup

Eleven Russian cities will host the World Cup over the next month. Unlike previous large international sporting events, including the Sochi Olympics in 2014, Universiade 2013 in Kazan and the 2014 World Cup in Brazil, Russian regions and cities managed to avoid significant World Cup-related debt increases. The majority of costs were carried by the federal government and private investors.


Russian Translation: некоторые российские города и регионы могут оказаться в проигрыше по итогам чемпионата мира

Russian Oil Restore Pre-2015 Profits, Gazprom Lags Behind

Most Russian oil producers restored 2017 profitability close to 2014 levels due to a price rebound. The outlier was Gazprom as its 2017 EBITDA significantly declined compared to 2014, partly due to a different tax structure applied on gas and lagging gas price increases.

Kazakh Banks' Asset Quality Still Weak; Clean-up Gradual

Very weak asset quality at Kazakh banks means that any clean-up will be gradual, even as regulators step up scrutiny of the sector, Fitch Ratings said at its 12th annual conference on Kazakhstan in Almaty.

Sanctions Raise Russia Bank Risk; Direct Exposure Limited

We do not expect any immediate rating impact. However, if banks continue to transact with the named individuals or companies, they themselves may face further sanctions.

US Sanctions Step Up Pressure on Russian Corporates

The latest US sanctions announced against a number of Russian companies, individuals and a bank on 6 April 2018 are likely to have a severe effect on these companies' operations and financial profiles by curtailing their ability to trade and service their US dollar-denominated debt.

Russian Banks Datawatch

See our latest Russian banking system report.

Azerbaijan Banking Sector Shows Signs of Stabilisation

The debt and asset restructuring of International Bank of Azerbaijan (IBA; B-/Stable; ccc/RWE) last year was the most significant recent development in the sector. Nearly all the bank's problem assets were transferred to a state-controlled non-bank entity, its risk-weighted assets contracted and its capital position was restored. 

Tighter Regulation May Slow Russian Life Insurance Boom

Premiums will have more than doubled over 2016-2017 as hybrid savings products, which offer a mix of guaranteed and non-guaranteed investment returns, attracted customers dissatisfied with falling interest rates on bank deposits.

rating action

Upgrade: Aeroflot to 'BB-'; Outlook Stable

Fitch views any socio-political implications of an Aeroflot default as moderate, since the airline has a pivotal role for the industry and a smooth replacement of the company would be unlikely. Financial implications on the sovereign of an Aeroflot default are weak, in our view. 

rating action

Russia Affirmed at 'BBB-'; Outlook Positive

Russia's ratings balance a strong sovereign balance sheet, robust external finances and an improved policy framework against weaker macroeconomic performance than peers, structural weaknesses (commodity dependence and governance risks) and geopolitical tensions. 

European Oil Majors Adapt to Low Oil; Break Even in 2017

The companies all generated neutral-to-positive free cash flows in 2017 (after dividends, before M&A), according to their recently released annual results. Developments in their credit quality will largely depend on their ability to preserve financial flexibility, as oil prices are likely to remain volatile.


Russian Banks - Crisis or not?

We get a lot of questions from investors about what recent failures of some large Russian private banks mean for the sector and whether there is a crisis. Our answer is ‘there is no crisis’ and here is why…

Nascent Recovery May Aid Russian Consumer Sector in 2018

An improving consumer environment in Russia should provide support for the country's retailers and consumer goods companies in 2018, Fitch Ratings says. However, any turnaround will be moderate at best and the benefit for local producers could be partially offset by increased competition from imports.

OPEC Move Limits Oversupply Risk, but Shale Key Long Term

The decision of OPEC, Russia and other oil-producing countries to extend their deal on production cuts reduces the potential for a significant market oversupply in 2018. We believe the extension has already been largely factored into oil prices, which are more likely to stabilise at USD50-60/bbl in the coming years; however, much will depend on the performance of US shale.

Russian Yarovaya Law Highlights Telco Regulatory Risks

The continuing uncertainty over the implementation of Yarovaya law increases the risk that many Russian telecoms may face significant one-off investments leading to a leverage spike in 2018. In our view it is unlikely that the law-related costs will be fully passed on to customers, thus spelling negative implications for the industry's profitability and cash flow generation. 

Russian Food Retail Adapting to Changing Consumer Trends

Russian food retailers are better positioned than some western European retailers to adjust to consumers' increasing preference for shopping at smaller convenience stores rather than at hypermarkets.


Clean-Up and Regulations Reshape Russian Banking Sector

The sector clean-up and regulatory changes have driven the banking system’s transformation. From 2013 to 1 September 2017, 346 licences were revoked and 35 banks rescued. Failures even of such large banks as Otkritie and B&N are not indicative of a systemic crisis, as their combined market share is only 5% and contagion has been limited.

rating action

Fitch Revises 23 Russian Financial Institutions' Outlooks to Positive on Sovereign Change

We have revised the Outlooks to Positive from Stable on 23 Russian financial institutions, comprising four state-related banks, 10 foreign-owned banks, certain subsidiaries of the state-related and foreign banks and National Clearing Centre. Their Long-Term Issuer Default Ratings (IDRs) have been affirmed.


Fitch on Russia: Sovereign and Banking Sector Outlook

Fitch Ratings held a teleconference on Wednesday 27th September to discuss the economic outlook and rating sensitivities for Russia; together with the current dynamics for and developments in the banking sector

Ukraine Bond Issue Is Positive but IMF Funding Still Key

Ukraine (B-/Stable) raised USD3 billion of 7.375% 15-year bonds on Monday in its first international issue since the crisis triggered by Russia's military intervention in 2014 and Ukraine's subsequent debt restructuring. The issue attracted orders of USD9.5 billion from around 350 investors, according to the Ministry of Finance. 


China and the Global Economy

In a recent interview with Vedomosti, James McCormack, Global Head of Sovereign Ratings at Fitch Ratings, discussed China and its role in the global economy.

Full version of the material is presented here

Kazakh Banks Datawatch

Kazakh Banks Datawatch consisting of key data from banks' regulatory financial statements and disclosures sourced primarily from the National Bank of Kazakhstan and Kazakhstan Stock Exchange


Dmitry Surkov

Regional Head of Russia/CIS and Black Sea Region

Dmitry Surkov

+7 495 956 9901

Julia Belskaya von Tell

Senior Director, Head of Business & Relationship Management Group

Julia Belskaya von Tell

Business Development, Media Relations

+7 495 956 9908

Mikhail Soloviev

Director, Business Development

Mikhail Soloviev

+7 495 956 7088