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Russian banks able to absorb potential losses from new US sanctions — Fitch

At the same time, sanctions are credit negative for companies affected by US sanctions, even if the Russian government provides support, the rating agency notes

MOSCOW, April 17. /TASS/. Russian banks are capable of absorbing potential losses related to new US sanctions, the international rating agency Fitch says on Tuesday.

"Most rated banks do not have material exposure, and those that do appear to have collateral or sufficient pre-impairment profitability to cover potential losses," the rating agency says. No immediate rating impact is therefore expected for Russian banks, the agency reports.

"However, if banks continue to transact with the named individuals or companies, they themselves may face further sanctions," Fitch says.

At the same time, sanctions are credit negative for companies affected by US sanctions, even if the Russian government provides support, the rating agency notes. "The companies are likely to lose some contracts and funding access, and their weakened credit profiles will increase the credit risk for banks that lend to them," Fitch adds.

On April 6, the US authorities imposed sanctions against a number of Russian officials, businessmen and companies. The list includes Gazprom CEO Alexei Miller, VTB CEO Andrei Kostin, Renova owner Viktor Vekselberg, General Director of Surgutneftegaz Vladimir Bogdanov, Sibur board member Kirill Shamalov, businessmen Igor Rotenberg, Oleg Deripaska and Suleiman Kerimov.

Sanctions were also slapped on Russia’s Agro-Holding Kuban, EuroSibEnergo, Rusal, Russian Machines, GAZ Group, B-Finance, Basic Element, En+, Renova, Ladoga Management, Russian Financial Corporation, NPV Engineering and Gazprom Bureniye.