Moody’s gives stable outlook to UAE banks

Moody's Investors Service said it affirmed the long-term ratings of four banks based in the United Arab Emirates and changed their outlooks to stable from negative. Affected by the rating actions were First Abu Dhabi Bank PJSC (Aa3), Abu Dhabi Commercial Bank PJSC (A1), Union National Bank PJSC (A1) and Abu Dhabi Islamic Bank (A2).

Al Hilal Bank PJSC’s A1 rating was affirmed, but the outlook on its long-term ratings remains negative.

The rating actions follow Moody's decision to affirm the UAE's government issuer rating at Aa2 and change the outlook to stable from negative.

The agency said the negative outlook on Al Hilal Bank is driven by its view that going forward the deteriorating trend in the bank's financial fundamentals will continue.

For the remaining banks, their long-term ratings continue to benefit from a high expectation of government support, which provides uplift to their long-term ratings that are therefore sensitive to changes in the creditworthiness of the UAE sovereign.

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