Kuwait's 11 Banks Are Downgraded By Fitch

Kuwaiti banks' Long-Term Issuer Default Ratings (IDRs) have been downgraded by Fitch Ratings. There is no change in their outlook.

Banks include 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) and Industrial Bank of Kuwait KSC. Fitch has also downgraded the support-driven Long- Term IDRs of NBK’s subsidiaries, NBK (International) PLC (NBKI) and NBK France SA (NBKF) and of BBY’s subsidiary, Bank of London and the Middle- East PLC (BLME).

They have a stable outlook. In January 2022, Fitch downgraded Kuwait's sovereign rating to AA- with an outlook of stable (see "Fitch Downgrades Kuwait to AA-; Outlook Stable" on www.fitchratings.com). No change is made to the banks' Viability Ratings (VRs). Following the publication of its updated Bank Rating Criteria on 12 November 2021, Fitch has removed its Support Ratings (SRs) for the 11 Kuwaiti banks and its Support Rating Floor for NBKI, NBKF, and BLME. The updated criteria led Fitch to assign NBK a Government Support Rating (GSR) of 'a+' and 'a' to the 10 other Kuwaiti banks, as well as Shareholder Support Ratings (SSR) of 'a+' to NBKI and NBKF and 'a' to BLME. IDRs are determined by the GSRs of Kuwait's 11 banks. SSRs are responsible for NBKI, NBKF, and BLME's IDRs. Fitch's view of Kuwait's potential support for Kuwaiti banks drives Kuwait's Long-Term IDRs for 11 Kuwaiti banks. Kuwaiti authorities are very likely to support the banks if needed, as is reflected in the GSR of 'a+' for the National Bank of Kuwait (NBK) and 'a' for the other ten banks.

 

 

 

SOURCE  ARABTIMES

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