“The rating change has but a limited impact on BCR, because the bank benefits from good liquidity levels, supported by the largest and most stable deposit base in Romania,” BCR said in a statement.
Wednesday, Moody’s Investors Service cut BCR and Raiffeisen Bank Romania to “junk status”, after downgrading their parent banks, namely Austrian Erste Group Bank AG and Raiffeisen Bank International AG.
The ratings agency cited a “rapid escalation” of non-performing loans in BCR’s portfolio, which is expected to take a toll on the bank’s profitability throughout 2012.
While benefiting from continued support from the mother bank, BCR’s weakening financial performance and a deteriorating business environment in Romania have reduced the bank’s creditworthiness, Moody’s said.