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Moody's upgrades nine Saudi Arabian banks

Moody's Investors Service has upgraded to A2/Prime-1 the foreign currency deposit ratings for nine Saudi Arabian banks.

  • Saudi Arabia: Tuesday, November 21 - 2006 at 08:36
  • PRESS RELEASE




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This rating action follows an earlier similar rating action on Saudi Arabia's foreign currency bank deposit ceilings (A2/Prime-1), to reflect the marked improvement in the country's economic fundamentals.

With the exception of Saudi Investment Bank, whose ratings carry a stable outlook, the outlook for the foreign currency deposit ratings of the other banks is positive, reflecting the outlook for the country ceiling.

None of the banks' financial strength ratings are affected by this rating action; neither are the deposit ratings of Bank al Jazira -- as they were not constrained by the previous country ceilings.

Moody's notes that the foreign currency deposit ratings of the nine banks are set at the country ceiling of A2/Prime-1 based on the banks' fundamental strengths, their importance to the system, as well as the strong likelihood of support from the Saudi Arabian authorities, should the need arise. However, in the future, any country ceiling upgrades would not automatically lead to upgrades in the foreign currency deposit ratings of all rated Saudi banks. This is because imputing systemic support in the ratings of banks with low financial strength ratings may not push their foreign currency deposit ratings higher.

The ratings affected are as follows:

- National Commercial Bank: foreign currency deposit ratings upgraded to
A2/P-1 with a positive outlook.

- Samba Financial Group: foreign currency deposit ratings upgraded to
A2/P-1 with a positive outlook.

- Al Rajhi Bank: foreign currency deposit ratings upgraded to A2/P-1 with a positive outlook.

- Riyad Bank: foreign currency deposit ratings upgraded to A2/P-1 with a positive outlook.

- The Saudi British Bank: foreign currency deposit ratings upgraded to
A2/P-1 with a positive outlook.

- Banque Saudi Fransi: foreign currency deposit ratings upgraded to
A2/P-1 with a positive outlook.

- Arab National Bank: foreign currency deposit ratings upgraded to A2/P-1 with a positive outlook.

- Saudi Hollandi Bank: foreign currency deposit ratings upgraded to
A2/P-1 with a positive outlook.

- The Saudi Investment Bank: foreign currency deposit ratings upgraded to
A2/P-1 with a stable outlook.

At the end of June 2006, National Commercial Bank had total assets of SAR155.1 billion (US$41.4 billion); Samba Financial Group had total assets of SAR112.6 billion (US$30.1 billion); Al Rajhi Bank had total assets of SAR101.2 billion (US$27.0 billion); Riyad Bank had total assets of SAR92.4 billion (US$24.7 billion); Banque Saudi Fransi had total assets of SAR75.5 billion (US$20.2 billion); The Saudi British Bank had total assets of SAR72.8 billion (US$19.4 billion); Arab National Bank had total assets of SAR68.9 billion (US$18.4 billion); Saudi Hollandi Bank had total assets of SAR44.5 billion (US$11.9 billion); and The Saudi Investment Bank had total assets of SAR39.2 billion (US$10.5 billion).

All banks are headquartered in Riyadh, Saudi Arabia, with the exception of National Commercial Bank which is headquartered in Jeddah.




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Notes and media contacts

Limassol
Constantinos Kypreos
Asst Vice President - Analyst
Financial Institutions Group
Moody's Investors Service Cyprus Limited
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Limassol
Mardig Haladjian
General Manager
Financial Institutions Group
Moody's Investors Service Cyprus Limited
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SUBSCRIBERS: 44 20 7772 5454

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Moody's Investors Service Pty Limited does not hold an Australian financial services licence under the Corporations Act. This credit rating opinion has been prepared without taking into account any of your objectives, financial situation or needs. You should, before acting on the opinion, consider the appropriateness of the opinion having regard to your own objectives, financial situation and needs.
Anne-Birte Stensgaard Posted by Anne-Birte Stensgaard, Senior News Editor
Tuesday, November 21 - 2006 at 08:36 UAE local time (GMT+4)

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This Article was updated on Tuesday, November 28 - 2006


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