Moody's cuts Dubai Bank

Moody's Investors Service said it downgraded the local- and foreign-currency deposit ratings of Dubai Bank by two notches to Baa2/prime-3 from A3/prime-2, along with its bank financial strength rating to E+ from D, which now maps to a baseline credit assessment of B1 instead of Ba2. The ratings on DB Sukuk Co.'s $5 billion trust certificate issuance program, launched on behalf of Dubai Bank in 2008, also have been lowered to Baa2/prime-3 from A3/prime-2.

The outlook is negative.

The outlook reflects the moderate risk of a further deterioration in the credit fundamentals of Dubai-based debtors that could impact the bank's baseline credit assessment and deposit ratings, Moody's said.

The downgrade reflects the material weakening in Dubai Bank's standalone strength as a result of the ongoing credit issues surrounding the Dubai corporate sector in which the bank is active, the agency said.

Pressure on asset quality has been growing since the end of 2008, resulting in significant provisioning charges throughout 2009, Moody's added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.