Abu Dhabi – Mubasher: RAM Ratings has reaffirmed rating of First Abu Dhabi Bank (FAB) at “AAA” and stable P1.
The Malaysian credit rating agency has also reaffirmed the AAA/Stable and AA1/Stable ratings of the UAE biggest bank by assets’ respective Senior and Subordinated MTN, issued under its Islamic/Conventional MTN Programme of up to RM3 billion (2010/2030), according to an official statement.
The rating reflects the agency’s anticipation of continued robust support from Abu Dhabi’s and the UAE federal government, propped up by FAB’s systemic importance in the banking sector.
Moreover, the contribution of the largest bank in the UAE in terms of assets represents 26% of the system’s deposits.
“The Group’s asset quality is weaker subsequent to its merger with First Gulf Bank PJSC, weighed down by higher-risk unsecured personal financing and credit card receivables. As at end-September 2018, the Group’s gross impaired loan ratio (including loans more than 90 days past due but not impaired) stood at a high 6.3% while its annualised credit cost ratio was 61 bps in 9M fiscal 2018,” the statement said.
However, the bank should provide a sufficient buffer against potential credit losses, the Malaysian firm noted.
By 11:56 am UAE time, FAB’s stock rose 0.27% at AED 14.63.
