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Fitch cuts nine Qatari banks
Fitch Ratings said it downgraded nine Qatari banks' long-term issuer default ratings.
Apart from Qatar National Bank, which was downgraded to A+ from AA-, the rest of the banks were downgraded to A from A+. They are Commercial Bank, Doha Bank, Qatar Islamic Bank SAQ, Al Khalij Commercial Bank QSC, Qatar International Islamic Bank, Ahli Bank QSC, International Bank of Qatar (QSC) and Barwa Bank QSC.
All outlooks are negative.
Fitch said this action follows its Aug. 28 downgrade of the Qatari sovereign by one notch to AA- and reflects its view that a timely resolution to Qatar's isolation is unlikely, although further risk of escalation has declined.
The downgrade also reflects the impact that the measures have had on Qatar's external balance sheet, with an expected fall of sovereign net foreign assets to 146% of GDP in 2017 from 185% in 2016, and the agency’s expectation that GDP growth will slow to 2% in 2017. Ultimately, the sovereign ability to support the banking system has weakened and all nine banks' issuer default ratings were downgraded to reflect this, Fitch explained.
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