Moody’s Investors Service changed the rating outlook on IIB to positive from stable

Moody’s Investors Service changed the rating outlook on IIB to positive from stable

On May 5th, 2017, Moody’s Investors Service changed the rating outlook on the International Investment Bank (IIB) to positive from stable and affirmed the IIB’s Baa1 issuer and debt ratings.

According to the Moody’s official statement, change of the outlook was due to the following main drivers:“the increased diversification of the IIB’s loan portfolio and the maintenance of relatively strong asset quality”, “the improved credit quality of the IIB’s treasury portfolio” and “the increased diversification of its funding sources.”

The mentioned above reasons of changing outlook are significant for the IIB due to the fact that Moody’s first rated the IIB at A3 in 2014 then downgraded the Bank to Baa1 in 2015 mostly because of the worsening growth prospects of Russia, downgraded by Moody’s three times in 2014 – 2015. Thus, the rating agency confirmed reliability, the foothold of the Bank and the IIB’s credit quality.

Commenting on the rating, Jozef Kollár, the Deputy Chairman of the IIB Board, said: “Moody’s decision is a testimony to the IIB’s supranational status and it proves the successful diversification of its loan portfolio, risk reduction and the financial stability of the institution. The improved outlook creates additional conditions for the development of a dialogue between the Bank and the investor community to implement new large-scale projects in the interests of our member states.

The upgrade to positive outlook by Moody’s is the second improvement in the IIB's rating profile over the past 6 months following Fitch's decision in December 2016 to upgrade the IIB to BBB stable – the first upgrade by the agency of any international financial institution since 2013, serving as a proof of the extraordinary quality and pace of the IIB’s development.