The rating of Ipoteka Bank reflects existence of the state support, recognizability of the brand and strong position of the bank in the market, good quality assets, sustainable liquid position and adequate capitalization, as well as sound financial results in the fourth quarter of 2010.

The rating also reflects favourable growth perspectives, intensive utilization of new segments of banking services market, as well as clear strategy of the bank, directed at further developing and diversification of business. Simultaneously, the rating takes into account high growth of assets and related risks, significant level of industrial and clientele concentration of the business of the bank, as well potential risks related to strategic growth and possible purchase of new assets.

During 31 December 2009-31 December 2010, the business scale of Ipoteka Bank grew with high temps. In the result of 2010, aggregate assets grew by 36% year-on-year to 1.061 trillion soums. The loan portfolio of the bank rose by 31.2% year-on-year to 560.6 billion soums. Simultaneously, other income-bearing assets of Ipoteka Bank, such as interbank assets grew by 19.1%, investment portfolio – by 69.6% and they made up 14.9% assets of the bank.

Quality of assets is evaluated as acceptable. In the fourth quarter of 2010, 91.93% of loans are rated as good, 5.09% - standard, 0.77% - substandard and 2.15% - doubtful, and 0.04% - bad.

It is necessary to noted that the volume of problematic loans of Ipoteka bank decreased and made up 0.08% (1.35% - 4Q 2009) of the loan portfolio. At the same time, unguaranteed loans made up 0.18% (0.63%) of loan portfolio. The level of reserves on loans in the analyzed period made up 0.81% (2.03% in 4Q 2009) of loan portfolio. Loan-term loans issued by the bank in the fourth quarter made up 4.72% of total loans.

The solvency of the Ipoteka Bank is high. The ready assets rose by 50.28% and their share in total assets reached to 39.85%. At the same time, the current liquidity ratio is in high level and makes up – 73.2%.

Ipoteka Bank receives main part of its funds from corporate clients. In the fourth quarter of 2010, about 67.16% of all borrowed funds of the bank fell to share of the banks. It is necessary to noted that funding base of Ipoteka Bank is increasing due to clients and attracted resources from other financial organizations. In the fourth quarter of 2010, the deposits and attracted funds in money markets grew by 33.93% and comprised 83.66% of the bank’s liabilities. Other part of borrowed funds fell to share of loans to settlement (29.32%) and deposits of the banks (0.35%). At the same time, average terms of borrowed funds of the bank are mainly short-term.

Capitalization of Ipoteka Bank is rated as balanced. In the fourth quarter of 2010, the aggregate capital of Ipoteka Bank grew by 12.87% to 121.3 billion soums. At the same time, the level of own capital reserves reached 11.43% (13.77% in 4Q 2009) in the fourth quarter of 2010. The ratio of capital adequacy and the first level capital adequacy made up 24.6% and 21% respectively.