Credit Bank of Moscow (CBOM), one of the so-called Garden Ring banks, raised RUB14.4bn in a successful SPO, the bank said on October 25. All of the 3.2mn newly-issued shares have found investors.

Out of the total SPO amount the Rossium Consortsium, controlled by banker Roman Avdeev, bought RUB6.75bn, confirming the previous reports that it will seek to maintain control of the CBOM.

CBOM had to boost the capital adequacy ratio after it was included in the systemic bank list in September 2017. Analysts surveyed by Reuters estimated that the bank's own capital will increase by about 9% after the SPO and make is safely comply to the requirements.

The bank also recently said that it increased its capital by RUB22bn by raising corporate subordinated deposits.

Reportedly the measures to increase the capital were expected by the investors who earlier this year bought perpetual and subordinated Eurobonds of CBOM, instruments that are not in favour after the Central Bank of Russia allowed subordinated debt to be written off for bailed-out banks.

CBOM also calmed the investors by arguing it has sufficient liquidity buffers, having RUB443bn of 28% of assets in untapped CBR funding as of September 1 2017.

Last month the perpetual bonds of CBOM tanked as fears that another Garden Ring bank could go to the wall continue to dog the market.

The value of the costly bonds fell to 74% of their face value, which corresponds to a yield of 16%, whereas a week earlier their value was 95% of face value that corresponded to a yield of 10.5%, Vedomosti reported on September 26.

The decline was caused by the "overall negative information flow regarding private Russian banks," a CBOM representative was quoted as saying by Vedomosti.

However, on the same week Moody's Investors Service upgraded the long-term local- and foreign-currency senior unsecured debt and deposit ratings of CBOM to Ba3 from B1, while changing the outlook to Stable from Positive.

Moody's believed that the upgrade of CBOM's ratings reflected the high probability of the bank's senior debt and deposits benefiting from support from the Central Bank of Russia (CBR). 

"The CBR recently introduced and tested its newly-designed toolkit to provide extraordinary support to large, privately-owned banks via its Banking Sector Consolidation Fund (BSCF)," said Moody's.