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Fitch Ratings downgrades Arap Turk Bankasi A.S.'s IDRs.

London: Fitch Ratings, a nationally recognized statistical rating organization (NRSRO) designated by the U.S. Securities and Exchange Commission, downgraded Arap Turk Bankasi A.S.'s (ATB) Long-Term Local and Foreign Currency Issuer Default Ratings (IDRs) to 'B+' from 'BB-' and the bank's Viability Rating (VR) to 'b+' from 'bb-' and removed them from Rating Watch Negative (RWN). The Outlook on the Long-Term IDRs is Stable.

This follows ongoing and increased market volatility in Turkey, including significant depreciation of the Turkish lira against the US dollar and euro. The rating action follows the downgrade of Turkish banks on 20 July 2018 subsequent to the Turkish sovereign rating downgrade to 'BB' from 'BB+' (see Fitch Downgrades 24 Turkish Banks; Removes from Rating Watch Negative on The downgrade of ATB's IDRs and VR primarily reflects the increased risks in the Turkish operating environment, where a material portion of the bank's business volume is concentrated, and therefore increased risks to the bank's asset quality, profitability, and capitalisation.

The removal of the bank's ratings from RWN and the Stable Outlook on the Long-Term IDRs reflect our view that risks to ATB's credit profile from the weakening Turkish operating environment are captured at the 'B+' level and further risks are mitigated by the bank's niche franchise in providing short-term, self-liquidating trade finance in the Middle East and North Africa (MENA) region.

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Publication:Daily the Pak Banker (Lahore, Pakistan)
Date:Oct 28, 2018
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