Introduction to our new service for Banks, the Rating Advisory Service
A pictoral representation of the procedure used in our Rating Advisory Service

Recent Advisory Projects Undertaken

  • Prepared research reports on Russian and Ukrainian banking systems.
  • Advised Keefe Bruyette & Woods Ltd investment banking team on developing relationships with banks in CEE and CIS countries.
  • Prepared and presented an alternative analysis to an international rating agency in response to its rating report of a bank in South-Eastern Europe. The analysis used detailed bank data to address specific negative points and opinions in the rating report.
  • Prepared and presented a formal appeal against an existing rating for a substantial privately-owned bank in South-Eastern Europe. This required a comprehensive analysis of in-house, market and external data. The main issues addressed included:
    • The effect of rapid loan growth rates (from a low base) on loan quality.
    • Loan and funding concentrations: how to measure them and when are they no longer a significant weakness. The use of the Herfindahl Concentration Index as a more accurate measure.
    • The effectiveness of subordinated loans in enhancing capital adequacy.
    • The level of economic risk for banks in a country: when a rating agency's assessment differs from that of the IMF.
    • Management's ability to manage continuing rapid growth and rising competition.
  • Assessed whether a medium-sized privately-owned bank in South-Eastern Europe had a sound basis to appeal against an existing rating. This involved:
    • An independent financial analysis of the bank.
    • An analysis of the agency's rating reports of the past three years to assess how its opinions have evolved, and how they compared against our opinions.
  • Assessment of whether a large bank in the Baltics has grounds for appealing for higher ratings. This involved:
    • A detailed comparison of the rating agencies' evolving opinions against our independent analysis.
  • Advised a small Baltic bank on the steps needed to obtain an optimal first credit rating.
  • Prepared a "red flag" analysis for a recently privatised bank in South-Eastern Europe.
  • In close cooperation with management, designed a long term planning model for a medium-sized privately-owned bank.

Rating Developments Limited, P.O. Box 56951, 3311 Limassol, Cyprus
Tel: +357.2533.5371
Fax: +357.2573.6229