Moody’s affirms Islamic Development Bank

Moody's Investors Service said it affirmed Islamic Development Bank’s issuer rating at Aaa with a stable outlook and short-term issuer rating at Prime-1.

The rating and outlook for the Islamic Development Bank's two special purpose vehicles for Sukuk issuance, Tadamun Services Bhd., and IDB Trust Services Ltd., were also affirmed at Aaa with a stable outlook. Tadamun’s senior unsecured domestic rating was affirmed at Aaa.

Moody’s said the affirmation and stable outlook reflect its view that the bank’s risk profile will remain very strong over the medium-term, supported by high capital adequacy ratios, low leverage and a stock of callable capital from investment-grade shareholders roughly twice the outstanding debt stock.

Despite the relatively low credit quality of the loan book and the challenging operating environment, non-performing loans remain very low.

The Islamic Development Bank’s liquidity position is strong, and market access is favorable given the bank’s prominence as one of the few top-rated Sharia'h compliant issuers in the Islamic finance world, the agency explained.

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