Training on sovereign risk credit analysis, October 24

ACRA assigns AAA(RU) to RU000A0ZZGE7 bond issued by LLC VW Bank RUS

Credit rating rationale. The issue represents senior unsecured debt of LLC VW Bank RUS (the Bank). Due to the absence of either structural or contractual subordination of the issue, ACRA regards it as pari passu to other existing and future unsecured and unsubordinated debt obligations of the Bank’s in terms of priority. According to the ACRA methodology, the credit rating of the issue is equivalent to that of LLC VW Bank RUS, i.e. AAA(RU).

The credit rating assigned to LLC VW Bank RUS is based on the very high likelihood of extraordinary support from the Volkswagen group, a parent group with high creditworthiness. The Bank's standalone creditworthiness assessment is relatively high, in view of its strong capital adequacy, strong risk profile, adequate liquidity and funding, and satisfactory business profile.

Key issue properties

Borrower

LLC VW Bank RUS

Issuer’s credit rating

ААА(RU), outlook Stable

Actual issuer

LLC VW Bank RUS

Type of security

Certified exchange-traded interest-bearing unregistered bond, 001Р-02 series

Issue volume

RUB 5 bln

ISIN/Identification number

RU000A0ZZGE7/4В020203500В001Р

Placement start date

August 15, 2018

Maturity date

August 17, 2021

Regulatory disclosure

The credit rating has been assigned under the national scale for the Russian Federation and is based on the Methodology for Assigning Credit Ratings to Individual Issues of Financial Instruments Under the National Scale of the Russian Federation, and Key Concepts Used by the Analytical Credit Rating Agency Within the Scope of Its Rating Activities.

A credit rating has been assigned to the 001Р-02 series bond (ISIN RU000A0ZZGE7) of LLC VW Bank RUS for the first time. The credit rating is expected to be revised within one year following the rating action date (August 13, 2018).

The assigned credit rating is based on the data provided by LLC VW Bank RUS, information from publicly available sources, and ACRA’s own databases. The credit rating is solicited, and LLC VW Bank RUS participated in its assignment.

No material discrepancies between the provided information and the data officially disclosed by LLC VW Bank RUS in its financial statements have been discovered.

ACRA provided no additional services to LLC VW Bank RUS. No conflicts of interest were discovered in the course of credit rating assignment.

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