Expected credit rating rationale. The issue represents subordinated debt of PJSC SCB "METALLINVESTBANK" (hereinafter, METALLINVESTBANK, or the Bank). In ACRA’s opinion, the terms of the issue contain separate provisions that satisfy the concept of a subordinated loan, as determined by Article 25.1 of Federal Law No. 395-1 dated December 12, 1990 “On Banks and Banking”, and comply with Bank of Russia Regulation No. 646-P dated July 4, 2018 “On the Methodology for Determining Equity (Capital) of Credit Institutions (Basel III)”. The proceeds from the bond issuance will be included in the Tier 2 capital of the Bank after its receipt of the respective approval from the Bank of Russia.

If the Bank of Russia agrees to include the funds raised as a result of the placement of the bond issue in the sources of additional capital for METALLINVESTBANK, then all creditor claims and default penalties under the subordinated bond loan will be satisfied after any other creditor claims if METALLINVESTBANK goes insolvent (bankrupt).

The terms of the issue provide for complete or partial write-off of the bond and the Bank’s refusal to pay income on the written-off bonds without the creditor having the right to claim unpaid interest and the written-off amount of the principal should any of the following events occur: 1) the N1.1 ratio stays below 2% for six or more business days within a continuous period of 30 business days; 2) the Board of Directors of the Bank of Russia approves a plan for the latter’s participation in the implementation of bankruptcy prevention measures with respect to the Bank, or the Committee on Banking Supervision of the Bank of Russia approves a plan for the Deposit Insurance Agency’s participation in the implementation of bankruptcy prevention measures with respect to the Bank.

According to ACRA’s methodology, the expected credit rating of this issue type is three notches below the final credit rating of the Bank (A-(RU)).

The credit rating of METALLINVESTBANK is based on the Bank’s sustainable business profile, strong capital adequacy, adequate risk profile, and adequate funding and liquidity position.

Key issue properties

Borrower

PJSC SCB "METALLINVESTBANK"

Issuer’s credit rating

A-(RU), outlook Stable

Type of security

Uncertificated non-convertible interest-bearing bond subject to centralized title registration, С-01 series

Type of debt

Subordinated (Tier 2 capital)

Issue volume

USD 30 mln

ISIN

RU000A103JK8

RegS

4-02-02440-B as of July 26, 2021

Placement start date

September 10, 2021

Maturity date

February 27, 2032

Call option

After March 5, 2027

Sources: ACRA, issuer’s data

Regulatory disclosure

ACRA will assign a credit rating to the series C-01 (RU000A103JK8) bond issue after the final documentation is provided by PJSC SCB "METALLINVESTBANK". In case of any significant discrepancies between the final documentation and the preliminary materials, ACRA may change the issue’s credit rating against the expected credit rating.

The expected credit rating has been assigned the series C-01 (RU000A103JK8) bond issue under the national scale for the Russian Federation based on the Methodology for Assigning Credit Ratings to Individual Issues of Financial Instruments on 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.

An expected credit rating has been assigned to the series C-01 (RU000A103JK8) bond issued by PJSC SCB "METALLINVESTBANK" for the first time. ACRA expects to assign the final credit rating within 180 days following the publication date of this press release.

The expected credit rating was assigned based on data provided by PJSC SCB "METALLINVESTBANK", information from publicly available sources, and ACRA’s own databases. The expected credit rating is solicited, and PJSC SCB "METALLINVESTBANK" participated in its assignment.

In assigning the expected credit rating, ACRA used only information, the quality and reliability of which was, in ACRA’s opinion, appropriate and sufficient to apply the methodologies.

ACRA provided no additional services to PJSC SCB "Metallinvestbank". No conflicts of interest were discovered in the course of the expected credit rating assignment.

We protect the personal data of users and process cookies only to personalize services. You can prevent the processing of cookies in your browser settings. Please read the terms of use of cookies on this website by clicking on more information.