BAKU, Azerbaijan, April 1. Fitch Ratings assigned Kazakhstan-based Home Credit Bank a long-term issuer default rating (IDR) of 'BB-', and viability rating (VR) at 'bb-', Trend reports, citing Fitch.
The agency indicated that the outlook on the IDR is stable.
Fitch notes that the resilience of the banking sector in Kazakhstan to external shocks contributes to the rating.
Its funding profile is almost equally split between customer deposits and wholesale borrowings, driving the loans-to-deposits ratio to a high 184 percent at end-3Q22. Liquid assets (cash and short-term interbank placements, net of short-term interbank borrowings) covered a reasonable 29 percent of total customer funding at end-3Q22.
According to Fitch, the rating can be upgraded if the bank pursues a more diverse business model, and improves its funding profile considerably. Additionally, the rating can be improved if the bank increases its systemic importance to the financial market.
It was noted, however, that the lack of ties to the government and the limited importance of the Home Credit Bank in the financial system of the country makes it an unlikely candidate to receive support from the government.
Fitch Ratings Inc. is an American credit rating agency and is one of the most reputable global rating agencies. The agency aims to provide business intelligence to facilitate the effectiveness of decision-making and decrease the business risks for its clients.
