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Dr Yahya A. Alyahya and Jammaz bin Abdullah Al-Suhaimi

Ratings boost for Gulf International Bank

Manama, December 4, 2012

International credit rating agency Moody’s Investors Service has reaffirmed bahrain-based Gulf International Bank’s (GIB) long-term and short-term foreign currency deposit ratings of A3 and P-2 respectively.

GIB’s standalone financial strength rating has also been reaffirmed, said the ratings agency in its report.

Moody’s pointed out that Bahraini bank’s solid capital base, asset quality and the improvementof its funding profile have contributed to the reaffirmation of these credit ratings.

Moody’s explained in its report that “recent improvements in GIB’s asset quality reduce downward pressure on the ratings. The bank’s asset quality metrics have improved following a reduction in the ratio of non-performing loans (NPL) to gross loans to 6.5 per cent as at September 2012, driven by NPL settlements and restructurings.”

On the ratings boost, GIB’s chairman Jammaz bin Abdullah Al-Suhaimi said, “We are pleased with Moody’s reaffirmation of the bank’s ratings and regard it as an independent endorsement of GIB’s successful efforts to strengthen its financial position and improve the quality of its assets and funding profile.”

The agency hinted that the outlook on the ratings can improve over the next few quarters as a result of continued asset quality improvements and the successful implementation of GIB’s new strategy and business model.

Moody’s also indicated that GIB’s “ownership by the Saudi government (Aa3 stable) is a key factor in the Bank’s standalone credit strength as it supports business origination and enables the Bank to adopt cost effective borrowing strategies.”

GIB’s chief executive officer Dr Yahya A. Alyahya said the bank’s funding profile has substantially improved over the past few years as it has taken proactive measures to reduce the mismatch in the maturities of its assets and liabilities and significantly reduced its dependency on short-term funding.

"The Bank’s initiatives to deleverage and de-risk the balance sheet have also significantly strengthened its financial position and enhanced its capital adequacy ratios,” he added.

GIB is a leading bank in the Middle East with its principal focus on the GCC states. Its primary shareholder is the Public Investment Fund of Saudi Arabia.-TradeArabia News Service




Tags: Bahrain | Gulf International Bank | Ratings | Moodys |

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