Russia’s Next Crisis: Gazprombank slashed to junk status
Today's Financial News - Posted January 14, 2009
Hot Stock Confidential, are up 15% on our “belt-and-suspenders” gamble on a severe drop in the Russian markets.
by J. Christoph Amberger
Baltimore—(TFN): Russia’s third-largest bank, Gazprombank, just had its credit rating slashed to “junk” status by Standard & Poor’s, which lowered the bank’s long-term and short-term counterparty credit ratings to BB+/B from BB-/A-3, with a negative outlook. The reason: Fallen earnings and a poor economy.
Gazprombank is 42% owned by Gazprom and is the main provider of financial services to Russia’s natural gas monopoly.
Bad timing for the Russian market: With the ruble in freefall, Russia just liquidated another $7 billion in dwindling reserves. Oil prices are half of what the apparatchiks in Moscow had budgeted for 2009. And the one resource that would command prime dollar in Europe’s coldest winter in decades has been cut off from its most solid customers.
The pressure is mounting to solve the Ukraine situation one way or another. Meanwhile, bearish pressure on the Moscow stock market is mounting once again.
Subscribers to our premium service, Hot Stock Confidential, are up 15% on our “belt-and-suspenders” gamble on a severe drop in the Russian markets.
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