Moody's upgrades Burgan Bank's FSR from D+ to C-

The ratings, which follow Moody's implementation of its refined joint default analysis and updated bank financial strength ratings methodologies (BFSR), also affirmed the Bank's Global Local Currency Deposit Ratings and Foreign Currency Deposit Ratings at A1/P-1, while affirming the FC Commercial Paper Rating at P-1.

In upgrading the Bank's FSR from D+ to C-, Moody's recognizes the consistent improvement in the Bank's financial fundamentals over the past reporting periods and has expectations that these improvements will be largely maintained. Specific credit improvements include the Bank's improved asset quality, underscored by its falling levels of non-performing loans (NPLs) and improved provisioning coverage of NPLs, as well as substantially lower levels of related-party loans relative to previous years. Furthermore, the bank has enhanced its risk management processes and improved its corporate governance structure.

Moody's noted that in addition to the improvements mentioned above, Burgan Bank's credit metrics remain relatively strong overall, highlighted by its healthy levels of capitalization, good cost efficiency indicators and high levels of balance sheet liquidity.

As of March 31st 2007, Burgan Bank announced an increase in net profit of 92%, reaching KD22.5 million for the first three months, as compared to the same period last year. This resulted in strong earnings per share, which went up by 96% at 28.4 fils. Return on equity reached 36.3%, a 68% jump over the achievement last year for the same period of 21.6%.

Burgan Bank was also recently acknowledged as the 'Best Local Private Bank' in Kuwait in the Fourth Annual Euromoney Private Banking Survey 2007, reflective of the high standards of wealth management services offered by the Bank. The Bank's steadily improving financial performance was also acknowledged by Standard & Poor's Ratings Services which revised its outlook on Burgan Bank from stable to positive in addition to affirming its 'BBB+' long-term and 'A-2' short-term counterparty credit ratings on the Bank.