Moody's upgraded outlook on LOCKO-Bank's B1 deposit ratings to positive

Moody's Investors Service affirmed the B1/Not Prime long-term and short-term local and foreign currency deposit ratings of LOCKO-Bank and changed the outlook on the long-term deposit ratings to positive from stable.

• LT Counterparty Risk Ratings, Affirmed Ba3
• Baseline Credit Assessment, Affirmed b1
• LT Counterparty Risk Assessment, Affirmed Ba3(cr).

The positive outlook reflects the possibility that Moody's may upgrade the bank's long-term deposit ratings over the next 12 to 18 months.

Confirmation of LOCKO-Bank 's ratings, according to Moody's, reflects strong indicators of funding and bank liquidity, high return on assets in the context of the Russian banking system, as well as a granular funding base. Profitability is supported by a high net interest margin and a steady flow of commission income.

Alexey Parfenenok, Financial Director of LOCKO-Bank:

“The revision of the rating outlook to Positive reflects the opinion of the rating agency on improving asset quality, and also reflects the financial soundness of the bank. The opinion is based on a stable credit profile with a sufficient level of capitalization, high profitability and a comfortable liquidity position. LOCKO-Bank 's margin increased to 6.6% in 2018 from 6.1% in 2017, despite the market downward trend. LOCKO-Bank continues to be consistently profitable on a long-term horizon with a constant increase in the share of commission income in revenue. LOCKO-Bank 's net fee and commission income has tripled in absolute terms over the past four years. Improving the forecast of the credit rating of a reputable international agency is an objective confirmation of the compliance of the results of our activities with the approved strategy. ”