Fitch Ratings affirms KIB’s long-term IDR at A+; outlook stable
‘KIB continues to benefit from fairly stable operating environment in Kuwait despite economic impact of low oil prices’
KUWAIT CITY, Oct 9: Fitch Ratings London, one of the leading global credit ratings agencies, has reaffirmed KIB’s Long-term Issuer Default Rating (IDR) at ‘A+’ and affirmed viability rating (VR) at “bb-” with a stable outlook on October 8. The stable outlook reflects the outlook on the Kuwaiti sovereign rating.
According to Fitch, KIB continues to benefit from a fairly stable operating environment in Kuwait despite the economic impact of low oil prices. The Bank is exposed to slower economic growth, but Fitch believes that the Kuwaiti government continuing capital spending plans will partially offset such pressures.
Fitch’s expectation of support from the authorities is underpinned by Kuwait’s strong ability to provide support to domestic banks, as reflected by the sovereign rating (AA/Stable) and strong willingness to do so irrespective of the banks’ size, franchise, funding structure and the level of government ownership. This view is reinforced by the authorities’ record of support for the domestic banking system in case of need.
Fitch views KIB’s new and experienced management team as necessary in order to execute the bank’s new strategy set out in 2015.
In Fitch’s view KIB’s liquidity is well managed and liquidity risk remains contained.
Sheikh Mohamed Al Jarrah Al Sabah, Chairman of KIB said; “This latest rating action is reflective of KIB’s impressive standing, and they serve to highlight the Bank’s strong financial core as well as the soundness of its growth strategy. KIB’s positive performance, as highlighted by the improved financial results, comes as a result of the Bank’s new strategy. This strategy which is currently underway aims to bring about a comprehensive transformation across all sectors of the bank, including: better asset quality, healthy capital buffer, improved performance, increase in profitability, new and innovative products, and enhanced service offerings to customers.”
Al-Jarrah further added: “KIB continues to make major strides in its mission to bring about a complete evolution of its banking operations and offerings. In an effort to provide customers with an enhanced digital banking experience, we have made major investments in upgrading our IT infrastructure and streamlining our systems and processes. We also continue to enhance our full suite of products and services, introducing innovative and state-of-the art banking solutions. Our Al Boushra and Arzaq deposit accounts continue to offer attractive profit rates. There is also a major push on the corporate banking side of our business, as we are developing tailored solutions and innovative products for corporate clients.
The Chairman concluded by saying: “Within the past year KIB has garnered a number of prestigious local, regional, and international awards further enhancing it’s already impressive collection of industry awards and recognitions. The most recent of these achievements include the ‘Best Islamic Bank in Kuwait’ for the year 2018 and the ‘Islamic Banking Chairman of the Year’ for 2018, awards from World Finance. Additionally, KIB was awarded “Best Customer Acquisition in Kuwait” for the year 2018 from CPI Financial,and many certificates in the information security field issued by specialized international institutions.