Moody s assigned to Bank Anelik "B2" rating with forecast "Stable"

ArmInfo. The international rating agency Moody's Investors Service has assigned to Bank Anelik a long-term rating of deposits in national and foreign currencies at 

the level of "B2" with the forecast "Stable" (Baseline Credit 

Assessment -BCA). The press service of the Bank informed ArmInfo 

about this.

"Assignment to the Bank of Anelik on the international scale is an 

important event for us, I am confident that this fact will allow us 

to further develop cooperation with partners in Armenia and abroad, 

and in the context of Armenia - to expand ties with foreign 

investors," said the Chairman of the Bank's Management Board Anelik 

Nerses Karamanukyan.

The assigned ratings reflect Anelik Bank's strong loss absorption 

supported by the bank's robust capital buffers and strengthening 

income generating capacity. Anelik Bank reported solid capital 

metrics with a Total Capital Adequacy ratio of 32.8% at 31 December 

2016. Moody's expects Anelik Bank's capital position to remain strong 

over the next 12-18 months supported by strengthening internal 

capital generation. 

In 2016, Anelik Bank's total regulatory capital increased by 165% to 

AMD 35.5 billion from AMD 13.4 billion as at YE2015, exceeding the 

minimum capital requirements of AMD 30 billion for Armenian banks 

effective from 2017. The increase was largely boosted by a capital 

injection of AMD 21.8 billion ($45 million) contributed by the bank's 

new shareholder FISTOCO LTD which acquired 59.68% equity stake and 

became Anelik Bank's majority shareholder . For 2016, Anelik Bank 

posted net profit of AMD 1.1 billion, up from AMD 215 million in 2015 

which translated into a moderate Return on Average Assets of 0.6%. 

Moody's expects that Anelik Bank's recurring profitability will 

substantially improve over the next 12-18 months, supported by 

increased business volumes and strengthening interest margin due to 

declining funding cost. Moody's expects asset quality to remain 

adequate, supported by the stabilized operating environment and the 

bank's increased focus on secured lending products. As of 31 December 

2016, the bank's problem loans (impaired corporate and retail loans 

overdue more than 90 days) accounted for 3.4% of gross loans. 

Moody's expects Anelik Bank's liquidity and funding profiles to 

remain adequate over the next 12-18 months. Customer accounts, mainly 

comprising corporate deposits, accounted for 70% of total 

liabilities.  Interbank funding and issued local bonds constitute the 

remaining portion of the bank's funding and in Moody's view carry a 

low refinancing risk. In addition, Anelik Bank has maintained a 

sufficient buffer of liquid assets around 20% of total 

liabilities, consisted mainly cash and liquid government bonds. 

According to the Financial Rating of the Armenian Banks prepared by 

the IA ArmInfo, Anelik Bank by the results of 2016 took the 5th 

position by assets - 283.5bln AMD, by the credit investments the 4th 

position - 218.8bln AMD, by the general obligations - the 4th 

position - 241.9 billion AMD, with the same position secured by time 

deposits of 156 billion AMD, the lion's share of which - about 70% - 

is the funds of legal entities. The volume of credit investments of 

Bank Anelik increased 3.6 times in 2016, which allowed to increase 

assets in the reporting year by 3 times, as a result of which the 

share of the loan portfolio in the bank's assets increased from 68% 

to 77%. The Bank increased its term deposits 3.5 times in the 

reporting year, which made it possible to increase liabilities almost 

as much (3.3 times). Net profit increased by 5.3 times to Anelik Bank 

for 1.2 billion AMD in 2016. (The calculated exchange rate of the AMD 

as of 31.12.2016 is 483.94 AMD/USD1). As of June 30, 2017, three 

tranches of Anelik Bank coupon bonds are listed on the NasdaqOMX 

Armenia exchange - two USD at $ 5 million and 1 billion in AMD. 

Moreover, the first - a USD tranche was issued in December 2016, and 

the remaining two fell in 2017. The fourth issue of the Bank's 

bonds-the next $ 5 million-was held on June 29 this year. And the 

placement is in progress.

To remind, Anelik Bank has been operating on the market since October 

1996. After the additional share issue in November 2016, the 

membership of the Bank's shareholders changed - the entry of the 

Cypriot company FISTOCO LTD with a stake of 59.68% reduced the share 

of the former shareholder in the face of the Lebanese Bank CreditBank 

S.A.L from 100% to 40.32%. Indirect majority shareholders are 

physical persons: Tarek J. Khalefe (CreditBank S.A.L) and Vartan 

Dilanyan (FISTOCO LTD).