Capital Intelligence affirms Oman Arab Bank's ratings.Summary: Capital Intelligence (CI), the international credit rating agency A credit rating agency (CRA) is a company that assigns credit ratings for issuers of certain types of debt obligations. In most cases, these issuers are companies, cities, non-profit organizations, or national governments issuing debt-like securities that can be traded on a , today announced that it has affirmed Oman Arab Bank's (OAB OAB Ordem dos Advogados do Brasil (Brazil) OAB Offline Address Book OAB Over-Active Bladder (urology) OAB Outlook Address Book (Microsoft) OAB Ocean Affairs Board ) foreign currency ratings at BBB BBB A medium grade assigned to a debt obligation by a rating agency to indicate an adequate ability to pay interest and repay principal. However, adverse developments are more likely to impair this ability than would be the case for bonds rated A and above. long-term and A3 short-term. Capital Intelligence (CI), the international credit rating agency, today announced that it has affirmed Oman Arab Bank's (OAB) foreign currency ratings at BBB long-term and A3 short-term. The ratings are underpinned by its ownership (and management) by Arab Bank The Arab Bank, formed in 1930, is a prominent financial institution in the Arab world, with 400 branches and offices in 25 countries.[1] Its parent company is Arab Bank plc incorporated in Amman, Jordan, where its headquarters are also located. , Jordan. The financial strength rating is maintained at BBB reflecting OAB's good profitability and very sound asset quality. The Bank's small balance sheet size and its tightening liquidity ratios which nevertheless remain better than industry average are constraining con·strain tr.v. con·strained, con·strain·ing, con·strains 1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force. 2. factors. The economic downturn could result in higher NPLs over the next few quarters, but OAB's good coverage ratio and high profitability are strong mitigants. A Stable outlook has therefore been appended to all the ratings. Strong business growth, a wider interest differential and good growth in fees, commissions and foreign exchange trading Foreign Exchange Trading or FX Trading, clients are able to hedge against, or speculate upon, changes in the exchange rate of two currencies. For example, a speculator can long EUR/USD in foreign exchange market in order to profit from capturing the appreciation of Euro against the profits contributed to OAB's good performance in 2008. The Bank continues to enjoy wider than industry average interest differentials due to its low funding cost. Its large contingent accounts business contributes to its strong non-interest revenue base. OAB draws on the resources of Arab Bank for financing and providing guarantees for projects, overcoming some of the disadvantages associated with its relatively small size. Asset quality ratios are sound -- the non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. (NPLs) to gross loans and the provision coverage ratios strengthened last year. The Bank's capital adequacy ratio Capital adequacy ratio (CAR), also called Capital to Risk (Weighted) Assets Ratio (CRAR)[], is a ratio of a bank's capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss. fell at end 2008 owing to owing to prep. Because of; on account of: I couldn't attend, owing to illness. owing to prep → debido a, por causa de the sizeable increase in risk assets, but following an injection of fresh capital in H1 2009, the ratio strengthened. OAB's first-half 2009 results were good although net profit declined owing to lower investment related income. Asset quality and capital adequacy ratios improved, and while liquidity ratios tightened further they were satisfactory. The Bank does not expect to grow its balance sheet at more than a moderatepace this year given the reduced demand from the corporate sector and the postponement of several major projects due to lack of adequate and timely financing. OAB intends to focus on retail customer deposit growth and will expand its branch network this year. OAB was established in 1984 when it purchased the Omani branches of Arab Bank. Arab Bank subscribed to 49% of OAB's share capital and Omani shareholders took 51%. OAB participates in financing development projects across Oman, and the Bank, either solely or together with Arab Bank, has been involved in all the major industrial and infrastructure projects over the last several years. OAB has successfully leveraged its close association with Arab Bank to develop a strong corporate banking business. The Bank's relatively small asset base (5.5% of total assets in the banking sector at end 2008) does not appear to have impaired its overall competitiveness, nor its access to top-tier customers within the country. 2009 Mena Report (www.menareport.com) 2009 Al Bawaba (Albawaba.com) Provided by Syndigate.info an Albawaba.com company |
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