(MENAFN Press) Capital Intelligence (CI), the international credit rating agency, announced today that it has affirmed Commercial Bank of Qatar's (Cb's) Long and Short-Term Foreign Currency (FC) ratings of 'a' and 'a2' , respectively, in accordance with the Bank's strong financial profile. The FC Ratings, on Stable Outlook, also reflect demonstrated government support for Qatari banks, a supportive operating environment and Qatar's high economic growth. In view of the Bank's systemic importance, the Support Rating is affirmed at '2'.
The Financial Strength Rating (FSR) is also affirmed at 'a' on the basis of the Bank's solid capital adequacy, improving ROAA and its business franchise. The headline non-performing loan (NPL) and loss coverage ratios have improved significantly and accordingly, the Outlook on the FSR reverts to Stable, despite a further rise in re-negotiated loans. Although liquidity is more than satisfactory in overall terms, the Bank's net loans/customer deposits ratio has tightened considerably and could pressure the FSR downward if it persists. The ratings are also constrained by high growth in loans and increased concentration in the real estate sector which could eventually lead to a rise in NPLs “ as well as by the small size of the Qatari banking market. Both factors combine to limit short-term sources of growth in assets and net profit.
With total assets of USD 19.7 billion, Cb is the second largest commercial bank in Qatar by total assets and capital. Cb was the first wholly privately owned local bank to be established in Qatar, with prominent local businessmen as its founding shareholders. Following a special issue of shares in 2009 and 2011, the Bank's largest single shareholder is now the Qatar Investment Authority with 16.7%. Cb provides a broad range of retail, wholesale and commercial banking services through its domestic operating platform of 35 full service branches. The Bank also has an international presence through its strategic investments in National Bank of Oman and United Arab Bank (UAE).
CONTACT
Primary Analyst
Chris Nicolaou
Senior Credit Analyst
Tel: 357 25 342300
E-mail: chris.nicolaou@ciratings.com
Secondary Analyst
Peter McFerran
Senior Credit Analyst
E-mail:peter.mcferran@ciratings.com
Rating Committee Chairman
Tom Kenzik
Senior Credit Analyst
The ratings have been initiated by Capital Intelligence. The issuer did not participate in the rating process. The information source used to prepare the credit ratings is public information. Capital Intelligence had access to the accounts but no other relevant internal documents of the issuer for the purpose of the rating. However, CI considers the quality of information available on the issuer to be satisfactory for the purposes of assigning and maintaining credit ratings. Capital Intelligence does not audit or independently verify information received during the rating process.
The rating has been disclosed to the rated entity and released with no amendment following that disclosure. Ratings on the issuer were first released in August 1986. The ratings were last updated in March 2011.
The principal methodology used in determining the ratings is Bank Rating Methodology. The methodology and the meaning of each rating category and definition of default, as well as information on the attributes and limitations of CI's ratings, can be found at www.ciratings.com.
