Bank ABC Jordan – Ratings Affirmed; CFS Lowered

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has affirmed the Long-Term Foreign Currency Rating (LT FCR) and Short-Term Foreign Currency Rating (ST FCR) of Bank ABC Jordan (Bank ABC) at ‘BB-’ and ‘B’, respectively. The LT FCR Outlook remains Stable. At the same time, CI Ratings has affirmed Bank ABC’s BSR of ‘bb-’ with a Stable Outlook, and the Extraordinary Support Level (ESL) of High, but lowered the Core Financial Strength (CFS) rating to ‘bb’ (from ‘bb+’).

The lowering of the CFS reflects continued asset quality pressures, partly driven by the crystallisation of credit concentration risks. The revision also considers the structurally weak funding profile (resulting in high funding costs), and an inflexible cost base. Both these factors contributed to further weakening in operating profitability and diminished capacity to absorb elevated provisioning needs. The CFS is constrained by the Bank’s small size and relatively…