Muscat Finance – National Rating Outlook Lowered to ‘omBBB+; Outlook Revised to Stable

Ref: OM025 19CRA 00-01 18 November 2020

Muscat Finance – National Rating Lowered to ‘omBBB+’; Outlook Revised to Stable

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has lowered the Long-Term Corporate Rating for Muscat Finance S.A.O.G. (MF) on the Oman National Scale to ‘omBBB+’ from ‘omA-’. The Short-Term rating on the same scale is affirmed at ‘omA2’. The Outlook on the r atings has however been revised to Stable from Negative.

The main driver s for the downgrade of the Long-Term Corporate Rating are the weakening of asset quality and the consequent negative impact on profitability from higher levels of provisioning. As expected, the already difficult economic conditions in Oman have been exacerbated by the impact of Covid-19. This has in turn meant that asset quality has come under further pressure at all lenders while liquidity in the market as a whole has tightened.

The ratings remain supported by…