Bahrain – Ratings Affirmed; Outlook Remains Negative

10 October 2025

Rating Action

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has affirmed Bahrain’s Long-Term Foreign Currency Rating (LT FCR) and LT Local Currency Rating (LT LCR) at ‘B+’. At the same time, CI Ratings has affirmed the sovereign’s Short-Term FCR (ST FCR) and ST LCR at ‘B’. The Outlook for the ratings remains Negative.

Rating Drivers

The ratings reflect persistent weaknesses in the public finances, including very high central government debt as well as increasing liquidity risks. The latter is due to the central government’s large gross financing needs and dependence on cross-border funding, which render it vulnerable to shifts in investor sentiment. The ratings also take into consideration Bahrain’s external vulnerabilities, which are exacerbated by the very high external debt and moderate international liquidity buffers.

The ratings are supported by continued – albeit declining – current account…