Bank Muscat’s Ratings Lowered; Outlook Remains Negative

Ref: OM01419 CRA00- 0 1 12 May 2020

Bank Muscat’s Ratings Lowered; Outlook Remains Negative

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has downgraded the Long-Term Foreign Currency Rating (LT FCR) and Short-Term Foreign Currency Rating (ST FCR) of Bank Muscat (BM) to ‘BB+’ and ‘B’, respectively, from ‘BBB-’ and ‘A3’. At the same time, CI Ratings has lowered BM’s BSR to ‘bb+’ from ‘bbb-’. The Outlook for both the LT FCR and BSR remains Negative.

The downgrade is largely due to the deterioration in the operating environment as a result of the coronavirus (Covid-19) pandemic and the sharp drop in oil prices (reflected in the Operating Environment Risk Anchor – OPERA – being adjusted downwards to ‘bb-’ from ‘bb’) and the adverse impact this is expected to have on the Bank’s financial fundamentals, in particular asset quality and profitability. It also follows the…