• According to Fitch, the good business profile of UniCredit Bulbank and its scale allow it to perform more sustainably compared to its competitors in Bulgaria, regardless of the impact coming from different economic cycles;
• The outlook of the long-term rating of the bank by Fitch of BBB is negative, and the agency points out that this reflects the current outlook of the long-term rating of the bank’s owner;
• The rating of UniCredit Bulbank by Standard and Poor’s, updated in July 2016, is BB+ with a stable outlook; it is equal to the rating of Bulgaria by the same credit rating agency.

International Credit Rating Agency Fitch determined the Long-Term Issuer Default Rating (IDR) of UniCredit Bulbank as “BBB“, its Support Rating (SR) as "2" and its Viability Rating (VR) as “bb". The long-term rating has a negative outlook. In their official release Fitch explained that the given outlook reflects the current outlook of the long-term rating of the owner of the bank.

The rating of UniCredit Bulbank by Standard and Poor’s, which was recently updated, is BB+/stable outlook /B and is equal to the rating of Bulgaria assigned by the same agency.

According to Fitch the profile of UniCredit Bulbank shows its leadership on the local market, its sustainable yield, strong capital buffers, stable financing and liquidity. The agency stated that the rating reflects also the opinion of Fitch experts that the Bulgarian bank and the CEE region are strategic to UniCredit.

“The good business profile of UniCredit Bulbank and its scale allow it to perform more sustainably compared to its competitors in Bulgaria, regardless of the impact coming from different economic cycles “, says the agency release. At the end of the first half of 2016, UniCredit Bulbank is the biggest bank in Bulgaria in terms of assets (around 20% market share), in terms of loans to customers (around 19%) and deposits (around 19%). Fitch added that the bank is number one on the Bulgarian market in the corporate segment and number two in retail banking. The agency specified also that the rate of bad loans is significantly lower than the banking sector average in Bulgaria, but is higher than the CEE average.

Another indicator to which Fitch pay attention is the bank’s capital, which significantly exceeds the regulatory requirements.

“The bank is financed by client deposits (which account for approximately 85% of its sources of financing at the end of the first half of 2016), it has a strong deposit model, high liquidity, and can further rely on support from its parent company“, says Fitch. The agency stated that the loan/deposit ratio reached 84% as at the end of June 2016 as a result of the nearly 25% growth of deposits in 2014 and 2015 because of the so called flight-to-quality upon the collapse of one of the biggest banks in the country and the aggravation of the Greek crisis, respectively.

Further information is available at www.fitchratings.com

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