Oman Arab Bank’s Ratings Lowered; Outlook Remains Negative

Oman Arab Bank’s Ratings Lowered; Outlook Remains Negative

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

The downgrade of the Bank’s ratings 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 our 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. The rating action also…