Fitch: Russian Standard Bank view negative

Fitch Ratings said it revised Russian Standard Bank's outlook to negative and affirmed its ratings at long-term issuer default rating BB-, short-term issuer default rating B, support 5, individual C/D and support rating floor "No Floor."

The negative outlook reflects Fitch's view that the prolonged capital markets weakness and resulting difficulty in getting incremental funding makes the bank's business model increasingly vulnerable. Reported net income was still strong in the first half of 2008, enhanced by reduced loan impairment charges due to the much-improved quality of loans issued after the tightening of the risk policies in October 2007, but the agency said these may need to be replenished somewhat once the default data on following loan generations becomes available.

The outlook could revert to stable if the bank manages to strengthen its funding profile without any significant deterioration in profitability and asset quality, Fitch said.

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