Moody's upgrades NKBM's ratings, outlook remains positive

Moody's upgrades NKBM's ratings, outlook remains positive 


Moody's  Moody's Investor Service has today upgraded Nova Kreditna banka Maribor d.d.'s (NKBM) long-term deposit ratings by two grades from Ba2 to Baa3. The upgraded rating is the result of a significant reduction in NKBM’s non-performing loan portfolio and changes in its balance sheet structure. More specifically, NKBM has continued to progressively reduce its legacy non-performing loans, while maintaining solid capital and liquidity base
 
The positive outlook on the long-term deposit ratings expresses Moody's expectation that NKBM will further strengthen is risk profile by ongoing problem loan reductions as well as improve its core earnings generation capacity on the back of the gradual revitalisation of new lending that has the potential to counter pressures from competition and the low interest rate environment. 
As of half-year 2018, the bank's problem loans ratio declined to 14% from 20% reported as of year-end 2017. Furthermore, NKBM reported a strong capital adequacy with a Tier 1 ratio of 21%, which provides an important risk mitigant against remaining asset risk as well as forms a solid base to accommodate future loan growth.