We noticed you're blocking ads.

Keep supporting great journalism by turning off your ad blocker.

Questions about why you are seeing this? Contact us

Font Size

- Aa +

Thu 24 Sep 2009 04:52 PM

Font Size

- Aa +

Seven UAE banks downgraded by Fitch

Ratings agency downgrades long-term issuer default ratings of Mashreq and Tamweel, among others.

Seven UAE banks, including
Mashreq

,
National Bank of Ras Al Khaimah

and
Tamweel

, had their long-term issuer default ratings (IDRs) downgraded by Fitch on Thursday.

The other banks were
Bank of Sharjah

,
Commercial Bank of Dubai

, Dubai Bank and Emirates Bank International.

In addition, the probability of government support for
Bank of Sharjah

, Dubai Bank,
RAK Bank

and
Tamweel

was downgraded to “high probability” or a 2, from “extremely high probability” or a 1.

The other three banks had their 1 support ratings affirmed.

“Fitch's revised view of the UAE sovereign reflects the increasing demands on its relatively small fiscal resources during the current period of economic stress,” it said.

By the end of the year, the credit rating agency expects Dubai’s government debt to have tripled compared to a year ago, to $30bn, which would be almost 40 percent of the emirate’s GDP.

Mashreq

’s long-term issuer credit rating was lowered by one level to A,
Commercial Bank of Dubai

was reduced one level to A- and Emirates Bank International one level to A+.

Bank of Sharjah

, Dubai Bank and
National Bank of Ras Al Khaimah

were all reduced one grade to BBB+.

Tamweel

was downgraded three levels to BBB reflects the weakened credit worthiness of its main shareholder, the emirate of Dubai.

The rating remains on rating watch evolving to reflect the continuing uncertainty over the lender’s future ownership and role in the UAE economy.

Under Fitch's rating criteria, a bank's standalone risk is reflected in its individual rating and the prospect of external support is reflected in its support rating.

Collectively these ratings drive the IDRs.

Arabian Business: why we're going behind a paywall

For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Real news, real analysis and real insight have real value – especially at a time like this. Unlimited access ArabianBusiness.com can be unlocked for as little as $4.75 per month. Click here for more details.
Jack 11 years ago

Is Dubai falling even more? What r we gonna do?

A M Rawof 10 years ago

In general, both Rating Agencies and Future Trading (Speculations) are doing damage to General Trade, economy and Consumers, and may be right time to ban globally. Apparently they may created many Madof's, than tycoons. However, reasonable laws should be in place with every country to check financial and trade misleading as well as inappropriate trade and financial practices. Consequently, manipulated ratings (if any) will disappear, and economy will grow in real phase than panic ridden.