Expert RA

Expert RA has increased Cheliabinvestbank rating to A from B++

August 18, 2008

The Expert RA rating agency has increased Cheliabinvestbank credit rating to A (high creditworthiness) from B++.

Balanced main activity indicators fostered the Bank creditworthiness. In 2007 the Bank grew assets by 34.3% and increased profitability by 0.34 percentage points to reach 3.03%. Cheliabinvestbank does not allow significant credit risk concentration, having an adequate risk management system. Another positive factor: the Bank participates in the state programs at the Cheliabinsk area. For instance, the area program “Town System” operates on the Bank technological base and includes automated processing of payments for communal and other services.

Ratio between main and additional capital is not proper and therefore hinders the rating. The additional capital share (based on re-appraised bank immovable property) was 44.32% by the end of the first quarter of 2008. “The re-appraisal was necessary for the Bank to have capital adequacy norm above minimum. Due to the re-appraisal Н1 is about 15-17%, which is plausible for a bank of such a size and specialty”, – says Anton Kartuesov, Expert RA, department of ratings of financial institutions. Other minuses: non-balanced time structure of assets and liabilities, narrow geographic span.

Cheliabinvestbank has been incorporated in 1990. The Bank operates mostly in Cheliabinsk area, being the 3-rd in assets and own capital. The Bank actively deals with individuals and SME. Cheliabinvestbank assets (RAS) by 01.04.2008 amounted to 15 926 mln rubles (the 117-th in the Russian bank ranking, according to Expert RA). Own funds (capital) – 2 284 mln rubles, profit before tax (first quarter of 2008) - 91 mln rubles.