Mubasher: Capital Intelligence Ratings (CI) has affirmed the financial strength rating (FSR) of the National Bank of Ras Al-Khaimah (Rakbank) at 'A-', according to a report issued on on Monday.
The bank's solid capital ratios, strong profitability, overall sound asset quality and satisfactory liquidity, are the main principal factors supporting the rating, as per the report.
“Despite some weakening of key metrics, the bank's overall financial position remains sound.
“However, CI Ratings notes that the net non-performing loan (NPL) accretion rate has risen over the last few years and is presently very high,” the report indicated.
“In view of the continued challenging environment in the SME segment there is a strong possibility that accretions will continue to be high this year.”
CI attributed the stable outlook to its belief that Rakbank is in a position to absorb additional provisioning given its still high operating profit and solid capital base.
Meanwhile, Rakbank’s long- and short-term foreign currency ratings (FCRs) are affirmed at 'A-' and 'A2', respectively. The ratings are supported and constrained by the same factors impacting the FSR.
