Bahrain-based Al Baraka Banking Group lowered to ‚BB+/B‘ on high MENA sovereign and economic risks

Posted by on Aug 8th, 2013 and filed under Islamic Finance. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Standard & Poor’s Ratings Services has lowered its long- and short-term counterparty credit ratings on Bahrain-based Al Baraka Banking Group (ABG) to 'BB /B' from 'BBB-/A-3'. The outlook is negative. The rating action follows S&P's review of the wider implications of deteriorated sovereign creditworthiness in the past 12 months in some countries in the Middle East and North Africa (MENA) , where ABG operates, especially Egypt and Jordan. The ratings agency lowered its assessment of ABG's risk position to "adequate" from "strong," owing to its operations in high-risk MENA countries. The ratings remain supported by ABG's strong business position, and its average funding and adequate liquidity position. The negative outlook reflects S&P's view that ABG’s capitalization could deteriorate to levels deemed as weak if, for instance, Egypt defaults and further economic stress materializes in Jordan.

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