Standard & Poor's Ratings Services has affirmed its 'A+/A-1' long- and short-term counterparty credit ratings on National Bank of Kuwait (NBK) with a stable outlook.

In its report, Standard & Poor’s said it expected NBK to benefit from the Kuwaiti government's infrastructure spending, leading to strong profitability, and robust capitalization.

The stable outlook reflects the agency’s belief that the bank's asset quality will remain stable and market share strong, it added.

The rating agency affirmed that “as the leading bank in Kuwait, NBK is well positioned to benefit from large infrastructure projects of the Kuwaiti government”.

The agency therefore expected “the bank will maintain its strong franchise, supporting its earnings stability. Coupled with this, we expect its largest subsidiaries - namely Boubyan Bank in Kuwait and NBK Egypt - to be strong contributors to earnings given that the demand for Islamic banking in Kuwait remains healthy and the economic environment in Egypt is, in our view, improving.”

Standard & Poor’s added that the affirmation reflects its expectation that the overall macroeconomic environment in Kuwait will remain benign, despite currently low oil prices, as the government accumulated large liquid assets in the run up to the fall of oil prices in mid-2014.

In its comments, Standard & Poor’s said: “We continue to view NBK's business position as strong, reflecting the bank's leading position in Kuwait, good and stable performance through the full economic cycle, and good management.”

The rating agency also maintained its strong assessment of NBK’s capital and earnings. “We expect capital will be supported by the issuance of $700 million additional Tier 1 (AT1) capital in April this year. Coupled with this, the bank finalised the ongoing sale of its minority stake in International Bank Qatar,” it added.

Welcoming the ratings, NBK said it has consistently been awarded the highest credit ratings in the region by the other major international rating agencies including Moody's and Fitch Ratings.

NBK is the only Arab bank to be listed among the world’s 50 safest banks for nine consecutive times, it added.-TradeArabia News Service