08:08 GMT20 June 2021
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    Moody's downgrades seven Russian financial institutions following the weakening of Russia's credit profile.

    LONDON/MOSCOW (Sputnik) Moody's Investors Service said Tuesday it had taken rating actions on seven Russian financial institutions following the weakening of Russia's credit profile, as reflected by Moody's recent downgrade of Russia's government debt rating to Ba1 from Baa3.

    The list of affected financial institutions comprises Sberbank, Bank VTB JSC, Gazprombank, Russian Agricultural Bank, Agency for Housing Mortgage Lending OJSC (AHML), Vnesheconombank and Alfa-Bank.

    "Specifically, Moody's downgraded the supported senior unsecured, subordinated debt and deposit and issuer ratings of the Russian financial institutions," the agency said in a statement.

    The supported ratings of all seven entities have been lowered by one notch, the statement said, citing declining capacity of the Russian government to assist each institution in the event of need.

    Moody's said last Friday its decision to cut Russia's sovereign debt rating to Ba1 was linked to the situation in Ukraine and slumping oil prices, among other reasons.

    It followed in the footsteps of the two other US-based rating agencies – S&P and Fitch – which lowered Russia's credit rating in January respectively to a "junk" BB+ and BBB- with a negative outlook.

    Many experts have argued that the so-called "big three" have made biased judgments based on the geopolitical situation, while Russia's Finance Ministry said the downgrades were based on an excessively pessimistic forecast that did not reflect the real market situation.

    There have been concerns that the Russian economy was too dependent on oil revenues, which slumped last summer after increased crude oil output caused global oil prices to nosedive.

    Moody's estimates that Russia is in for a continued economic downturn with gross domestic product falling by 5.5 percent in 2015 and 3 percent in 2016.

    But the Russian Finance Ministry vowed the economy was resilient to "external shocks" in the oil and forex markets.

    Related:

    Moody’s Sovereign Rating Downgrade Politically Charged - Russian Official
    Russian Capital Market Unlikely to Change After Moody’s Downgrade – FinMin
    Moody’s Downgrades Russia’s Sovereign Debt Rating to Ba1, Outlook Negative
    Tags:
    rating, Sberbank, Moody’s, Russian Agricultural Bank (RusAg), Gazprombank, VTB, Russia
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