11 KUWAITI BANKS HAVE BEEN DOWNGRADED BY FITCH

  • 10/02/2022

Dubai: The Long-Term Issuer Default Ratings of 11 Kuwaiti banks have been lowered by Fitch Ratings (IDRs). Their prospects appear to be stable.


National Bank of Kuwait SAKP (NBK), Kuwait Finance House KSCP (KFH), Boubyan Bank KSCP (BBY), Gulf Bank KSCP, Burgan Bank KPSC (BB), Al Ahli Bank of Kuwait KSCP, Commercial Bank of Kuwait KPSC, Ahli United Bank KSCP (AUBK), Kuwait International Bank KSCP (KIB), Warba Bank KSCP (WB), Kuwait International Bank KSCP (AUBK), Kuwait (IBK). NBK's subsidiaries, NBK (International) PLC (NBKI) and NBK France SA (NBKF), as well as BBY's subsidiary, Bank of London and the Middle East PLC, have had their support-driven Long-Term IDRs downgraded by Fitch (BLME). 

Their prospects appear to be stable. Fitch downgraded Kuwait's sovereign rating to 'AA-'; Outlook Stable' on January 27, 2022 (see "Fitch Downgrades Kuwait to 'AA-'; Outlook Stable" at www.fitchratings.com). The Viability Ratings (VRs) of the banks are unaffected. Following the publication of its amended Bank Rating Criteria on November 12, 2021, Fitch has revoked the Support Ratings (SRs) and Support Rating Floors of the 11 Kuwaiti banks, as well as the SRs of NBKI, NBKF, and BLME, since they are no longer relevant to the agency's coverage. 

Fitch has awarded a Government Support Rating (GSR) of 'a+' to NBK and 'a' to the 10 other Kuwaiti banks, as well as a Shareholder Support Rating (SSR) of 'a+' to NBKI and NBKF and 'a' to BLME, in accordance with the amended criteria. The 11 Kuwaiti banks' IDRs are determined by their GSRs. SSRs are what drive the IDRs of NBKI, NBKF, and BLME. Fitch's assessment of probable Kuwaiti state support drives the Long-Term IDRs of the 11 Kuwaiti banks. The GSRs of 'a+' for NBK and 'a' for the other ten banks indicate Fitch's assessment of an exceptionally high possibility of Kuwaiti government support for the banks if needed.

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