United Finance Company S.A.O.G. – Initial Ratings on the Oman National Scale Assigned

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has assigned first-time Long- and Short-Term issuer ratings on the Oman National Scale to United Finance Company S.A.O.G. (UFC or the Company) of ‘omBBB+’ and ‘omA2’, respectively. The Outlook on the ratings is Stable.

The ratings are underpinned by an improving operating environment in Oman, along with UFC’s comfortable leverage metrics – the latter, however, is subject to a moderately impaired capital base due to unprovided non-performing financing receivables (NPFRs). Also supporting the ratings are satisfactory liquidity coverage of short-term debt obligations and improving profitability at both the operating and net levels.

While a cautious stance on new credit extensions has helped to improve asset quality, it has also weighed on UFC’s market share in the already small finance company segment in Oman – a segment that also faces intense competition from local banks. Additional…