Sharjah Islamic Bank on a positive outlook

The foreign currency ratings were affirmed at BBB+ long-term and A2 short-term, while the financial strength rating was maintained at BBB+.

The increase in capital in April this year, the bank's good management, sound asset quality and strong, sustainable core profitability are underlying factors supporting the ratings.

SIB nearly doubled its capital this year to support its ambitious plans for growth in the UAE and the region.

SIB's well managed operations have turned in consistently strong results over the last several years.

The small amount of impaired assets in the financing portfolio are more than adequately covered by provisions.

The booming local economy and strong corporate results have contributed to the bank's sound asset quality.

The lengthening maturity profile of the customer financing book has increased credit and liquidity risks, but there are mitigating factors such as the availability of collateral and wider funding options (SIB has already tested the market with a successful sukuk issuance in 2006).

The existence of sector and geographic concentrations are major factors constraining the ratings.