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Moody's assigns Ba2/B2/NP/E+ ratings to Bank Moscow-Minsk (Belarus)

July 18, 2008
First-time ratings

Moscow, July 15, 2008 -- Moody's Investors Service has today assigned the
following global scale ratings to Bank Moscow-Minsk ("BMM"): Ba2 long-term
local currency and B2 long-term foreign currency deposit ratings, Not-Prime
(NP) short-term foreign and local currency deposit ratings, and an E+ bank
financial strength rating (BFSR). The outlook for all ratings is stable.

According to Moody's, BMM's E+ BFSR, which translates into a Baseline Credit
Assessment of B2, is supported by BMM's solid position in corporate and
retail franchise benefiting from its links to the stronger parent -- JSCB
Bank of Moscow (BOM) -- and expanding branch network, reasonable
diversification of business, and good profitability and asset quality. The
BFSR is constrained by operating environment which is subject to
administrative measures, challenges to the bank's risk assessment system
given its rapid growth, concentrated corporate loan book and funding,
inefficient economic capital management reflected in high credit risks in
relation to capital, and untested ability to withstand intensifying
competition in the longer term.

The BMM's Ba2 long-term local currency deposit rating factors in i) its
B2 BCA, ii) low systemic support given the bank's notable market shares and
ii) Moody's assessment of a very high probability of the parental support
from its parent -- BOM (A3/Baa2 (RUR)/P-2/D, stable outlook) -- in the event
of a stress situation. Moody's assessment of the support probability is
based on the bank's 100% ownership by Bank of Moscow, its strategic fit to
the BOM's operations in light of its importance for the BOM and the City of
Moscow in supporting their relationship with the Belarusian administration
as well as BOM's diversification of business and cross--selling
opportunities. As a result, the long-term local currency deposit rating
receives a three-notch uplift to Ba2 from the bank's B2 Baseline Credit

BMM's B2 long-term foreign currency deposit rating is constrained by the
relevant country ceiling for Belarus.

BMM's BFSR could be upgraded if the bank significantly reduces the credit
risks in relation to equity and concentrations on the asset and liability
side as a result of further diversification of its franchise maintaining
adequate financial fundamentals. The bank's local currency deposit rating is
likely to follow the parent's BFSR. Downward rating pressure on BMM's BFSR
could result from asset quality or liquidity problems but such occurrence is
not envisaged in the short-to-medium term.

Headquartered in Minsk, Belarus, BMM reported total consolidated assets of
US$310 million and total equity of US$36 million and ranked eighth by assets
among Belarusian banks as of 31 December 2007. BMM is active in corporate
and retail transactions, with the former supported by its links with BOM.

BOM is headquartered in Moscow, Russian Federation. At year-end-2007, BOM
reported total consolidated assets of RUB528 billion (US$21.5 billion) and
net income of RUB8.9 billion (US$362 million) and was the country's fourth
largest bank. It is majority controlled by the City of Moscow (directly and
indirectly). The other largest shareholders are the two most senior managers
who control 18% in the bank.
Company — Bank Dabrabyt
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    Bank Dabrabyt JSC
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