ACRA has retained the status “Rating under revision: negative” for QIWI Bank (JSC) (hereinafter, QIWI Bank, or the Bank) to reflect its opinion on the continuing uncertainty related to the Bank of Russia imposing restrictions on QIWI Bank’s cross-border activities at the start of December 2020. In particular, the Agency still cannot exclude risks associated with further negative regulatory intervention in the Bank’s activities over the next three months. In addition, uncertainty remains regarding the stability of development of the Bank’s business and that of QIWI plc (hereinafter, QIWI, or the Group) amid the limitations imposed by the Bank of Russia.
Key rating assessment factors
The Agency supposes there is some possibility of the regulator continuing to focus and put pressure on the Bank over the short and medium-terms. Furthermore, the regulatory limitations have affected significant for QIWI’s business operations and under the worst-case scenario this may put pressure on the Bank’s development over the next 12–18 months and lead to a certain transformation of its business.
ACRA may downgrade or affirm the rating of QIWI Bank as the situation regarding the above risks develops and additional information becomes available over the next 90 days.
The credit rating of QIWI Bank is BBB+(RU) based on the satisfactory business profile assessment, strong capital adequacy and profitability, and adequate assessments of the risk profile and funding and liquidity position.
QIWI Bank services the operations of QIWI and is a key element of the Group’s payment services, one of the leading providers of multifunctional payment services in the Russian and other CIS markets. The ultimate owners of the Bank are «Bank Otkritie Financial Corporation» (Public Joint-Stock Company) (AA(RU), outlook Stable; 34%), S. A. Solonin (17%), and B. Kim (0.7%). The remaining stake of around 48% is in free float. The key strategic shareholder, with the largest voting rights, is S. A. Solonin.
- Development of the situation in relation to the risk of further regulatory intervention in the Bank’s activities;
- Continuing uncertainty of the final interpretation of regulatory restrictions and their impact on the Bank’s activities.
Potential outlook or rating change factors
The “Rating under revision: negative” status assumes that the rating may be downgraded within the next 90 days.
Removal of the “Rating under revision: negative” status and affirmation of the credit rating may be prompted by:
- Resolution of uncertainty regarding the risk of further negative regulatory intervention, as well as ACRA’s understanding of factors that will help the Bank to adapt its business in the context of existing restrictions, and/or significant alleviation of the restrictions.
Removal of the “Rating under revision: negative” status and downgrade of the rating may be prompted by:
- Implementation of regulatory risks in the form of the Bank of Russia carrying out further negative actions in relation to QIWI Bank;
- ACRA’s opinion on the negative influence of the Bank of Russia’s limitations on the operations and future business of the Bank and the Group.
No outstanding issues have been rated.
The credit rating has been assigned under the national scale for the Russian Federation based on the Methodology for Credit Ratings Assignment to Banks and Bank Groups Under the National Scale for the Russian Federation and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities.
The credit rating of QIWI Bank (JSC) was published by ACRA for the first time on July 2, 2018. The credit rating and its outlook are expected to be revised within 90 days following the publication date of this press release.
The credit rating was assigned based on the data provided by QIWI Bank (JSC), information from publicly available sources, as well as ACRA’s own databases. The rating analysis was performed using the IFRS financial statements of QIWI Bank (JSC) and the financial statements of QIWI Bank (JSC) drawn up in compliance with Bank of Russia Ordinance No. 4927-U dated October 8, 2018. The credit rating is solicited, and QIWI Bank (JSC) participated in its assignment.
No material discrepancies between the provided data and the data officially disclosed by QIWI Bank (JSC) in its financial statements have been discovered.
ACRA provided additional services to QIWI Bank (JSC). No conflicts of interest were discovered in the course of credit rating assignment.