Fitch awards stable outlook to Bahrain bank.MANAMA: Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has placed Bahrain-based BBK's individual rating of 'C/D' on rating watch negative (RWN RWN Right Wing News (weblog) RWN Rural Women's Network (Australia) RWN Arens Field Airport (Winamac, Indiana, USA) RWN Reconfigurable Wireless Network ) over concerns about some of its investments. Fitch has simultaneously affirmed BBK's Long-term issuer default rating (IDR IDR In currencies, this is the abbreviation for the Indonesian Rupiah. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) at 'A-' with a stable outlook, short-term IDR at 'F2', support rating at '1' and support rating floor at 'A-'. The RWN on BBK's individual rating reflects its recent impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges for investment securities at BD47 million ($124.7m) for last year compared to BD4m in 2007. It also reflects the net movement in cumulative changes in fair value of investments at BD33m compared with BD8m in equity in 2007 and Fitch's concern that the bank's performance this year may also be negatively impacted by losses from investment securities. While the bank has fully provided for its exposure to structured investment vehicles of BD57m and Lehman Brothers Lehman Brothers Holdings Inc. (NYSE: LEH), founded in 1850, is a diversified, global financial services firm. It is a participant in investment banking, equity and fixed income sales, research and trading, investment management, private equity, and private banking. , the bank has some residual exposure to collateralised debt obligations in its credit default swaps Credit Default Swap A swap designed to transfer the credit exposure of fixed income products between parties. Notes: The buyer of a credit swap receives credit protection, whereas the seller of the swap guarantees the credit worthiness of the product. book, where market conditions continue to be extremely adverse. BBK BBK Bundesamt für Bevölkerungsschutz und Katastrophenhilfe (German) BBK Bilbao Bizkaia Kutxa (Bank of Bilbao, Spain) BBK Bank of Bahrain and Kuwait BBK BB King (blues artist) is exposed to fairly substantial market risks from its portfolio of debt securities as well as some equity investments. Further negative pressure on BBK's individual rating arises from its tightened liquidity and substantially increased exposure to property lending last year. Fitch will resolve the RWN in July following a review of BBK's first half performance. BBK's individual rating also reflects its significant domestic franchise and adequate asset quality and capitalisation. BBK's rating reflects Fitch's view that there is an extremely high probability that the bank would receive support from the Bahraini authorities, if required. This is based on its importance to the local banking system and its 32 per cent indirect ownership by the Bahrain government. Copyright 2009 Gulf Daily News Provided by Syndigate.info an Albawaba.com company |
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