Spectator on facebook

Spectator on facebook

CORPORATE BRIEFS

Standard & Poor's assigns Istrobanka Bpi Rating

International rating agency Standard&Poor's (S&P) assigned a single -"B"- pi (public information) rating to Istrobanka on November 18. A statement provided by S&P's London office said the rating reflected concerns over the bank's asset quality, its impaired performance and low capital levels.

The "pi" subscript indicates that S&P performed its analysis based on public information only, and highlights the restricted nature of the research done on Istrobanka compared with a standard, full ratings procedure.

S&P stresses that Istrobanka, holding about 3% of Slovak lending and deposit markets, benefits from its current ownership structure, with a large, local insurer - the state-controlled Slovenská Poisťovňa - holding a 72% stake. This alliance gives the bank access to the insurer's large network, customer base and liquidity.

In the near future, Slovenská Poisťovňa plans to sell a large portion of its stake to a strategic foreign investor. This improves Istrobanka's business prospects considerably, with regard to possible technology upgrades and expertise. Istrobanka's other shareholders are the municipality of Bratislava (18%), and Erste Bank der Osterreichischen Sparkassen (10%), based in Vienna.

S&P believes that Istrobanka's asset quality remains vulnerable to its uncertain operating environment. Its loan portfolio is subject to credit-risk concentrations, given the limited number of quality borrowers on the market. For example, during 1998 the financial situation of Istrobanka's two largest borrowers, which accounted for 4% of the bank's loan portfolio, suddenly deteriorated. As a result, Istrobanka's nonperforming loans more than doubled by year-end 1998, to 9%, prompting the bank to increase provisions to cover its classified loans fully with reserves.

Top stories

Slow down, fashion

Most people are unaware that buying too many clothes too harms the environment.

In shallow waters, experts are expendable

Mihál says that it is Sulík, the man whom his political opponents mocked for having a calculator for a brain, who “is pulling the party out of liberal waters and towards somewhere completely different”.

Richard Sulík is a man of slang.

Poll: Smer followed by SaS, KDH also in parliament

Had the general election taken place in mid-February, the opposition Freedom and Solidarity (SaS) would place second, and the now extra-parliamentary KDH would get nine seats.

Alojz Hlina took over at the helm of KDH

Woman who urinated on the Quran arrested, awaiting trial

Some observers believe the video might lead to increasing security risks for Slovakia.

The accused woman arrives to the court.