S&P takes Doha Bank off watch

S&P said it affirmed and removed Doha Bank Assurance Co. LLC’s BBB ratings from CreditWatch with negative implications.

“In September 2019, the Qatar International Court and Dispute Resolution Centre ruled against DBAC in relation to a major advance payment and performance bond guarantee contract. This was one of the few unexpected large claims that DBAC received during 2018. The gross amount of this claim totaled QAR 63 million. Due to insufficient reinsurance coverage, DBAC is currently liable to the full amount, although we note that DBAC has taken legal recourse for recovery, the result of which remains uncertain at this stage. We understand that the other large claims are covered by DBAC's reinsurers, significantly limiting its net exposure. Nevertheless, we think there are deficiencies in DBAC's risk management practices,” said S&P in a press release.

The outlook is negative.

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