S&P: Troika Dialog Group Ltd. Cut To 'B+/ruA' On Deteriorated Market Conditions; Outlook Negative
December 12, 2008 "Standard & Poor's"
PARIS (Standard & Poor's) Dec. 11, 2008--Standard & Poor's Ratings Services said today that it lowered its long-term counterparty credit rating on Troika Dialog Group Ltd. (Troika) to 'B+' from 'BB-' and its Russia national scale rating to 'ruA' from 'ruAA-'. The outlook remains negative.
At the same time, Standard & Poor's affirmed its 'B' short-term counterparty credit rating on the institution, the holding company of Russia's Troika Dialog group.
"The rating action reflects Troika's deteriorated operating environment, which is leading to a decline in the group's business volumes and funding position, and as a result, in profitability," said Standard & Poor's credit analyst Ekaterina Trofimova.
The ratings are based on the creditworthiness of the Troika Dialog group companies, which form one of Russia's leading brokerage, asset management, and investment banking groups. The ratings on Troika reflect the group's stand-alone credit quality, and do not include any uplift for extraordinary external support--either from owners or the government.
"The negative outlook reflects Troika's vulnerabilities to current market conditions. A longer or deeper financial crisis could further weaken Troika's franchise or financial profile, further pressuring the ratings," said Ms. Trofimova.
We could revise the outlook back to stable or raise the ratings if market pressures ease significantly and if Troika regains positive business momentum, restores profitability to a level commensurate with its risk profile, substantially reduces concentrations, and improves its funding profile.
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